A CLOSED-FORM SOLUTION FOR THE HEALTH CAPITAL MODEL*. (9th September 2015)

• Record Type: Journal Article
• Authors: Strulik, Holger
• Is Part Of: Journal of demographic economics. Volume 81:Number 3(2015)
• Page Start: 301
• Page End: 316
• Publication Date: 2015-09-09
• Subjects: Demography -- Economic aspects -- Periodicals; Population -- Economic aspects -- Periodicals; 304.605
• DOI: 10.1017/dem.2015.4
• Languages: English
• ISSNs: 2054-0892

Abstract

<abstract abstract-type="normal"> <title>Abstract:</title> <p>This paper provides a closed-form solution for the health capital model of health demand. The results are exploited in order to prove analytically the comparative dynamics of the model. Results are derived for the so-called pure investment model, the pure consumption model and a combination of both types of models. Given the plausible assumptions that (i) health declines with age and that (ii) the health capital stock at death is lower than the health capital stock needed for eternal life, it is shown that the optimal solution implies eternal life.</p> </abstract>