The Distributional Effects of Medical Advances No clear predictions from economic theory The effects depend on: 1. Prevalence of the health problem(s)

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The Distributional Effects of Medical Advances No clear predictions from economic theory The effects depend on: 1. Prevalence of the health problem(s) 2. Complexity and cost of the advance 3. Access to the advance (insurance, etc) Welfare effects may differ from health effects 1. Trade-offs between health and other commodities may differ 2. Advances may facilitate harmful behaviors Health depends on many factors besides medical care

Year-to -Year Change of Age-adjusted Death Rates, U.S. Whites and Blacks, (5 year moving average centered on middle year) Deaths per 100,000

Year-to -Year Percentage Change of Age-adjusted Death Rates, U.S. Whites and Blacks, (5 year moving average centered on middle year) Percent per annum

Standard Deviation Across 50 U.S. States of Log of Age-adjusted Death Rate, Standard deviation 0

OLS Regression Results Across 50 States Dependent Variable:Rate of decline of Age-adjusted mortality , percent per annum (sign reversed) Mean0.737St.Dev RHS Variables Regression(StandardP Value Coefficient Error) % in poverty (a (0.0079) % black (a (0.0028) % >=65 (a (0.0111) % foreign born (a (0.0054)< Constant (0.1616)< R 2 =0.564 Adj. R 2 = a) Mean of 1980,1990 and 2000