Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/48289
Title: 

Impact of Health Insurance on Consumption and Saving Behaviours: Evidence from Rural China

The document was removed on behalf of the author(s)/ the editor(s).

Year of Publication: 
2011
Series/Report no.: 
Proceedings of the German Development Economics Conference, Berlin 2011 No. 18
Publisher: 
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften, Leibniz-Informationszentrum Wirtschaft, Kiel und Hamburg
Abstract: 
By reducing risk on income, health insurance may reduce household precautionary behaviours and boost consumption. This paper evaluates the impact of a subsidized public health insurance scheme designed for rural residents, the New Cooperative Medical Scheme (NCMS), on consumption and saving behaviours in rural China. To do so, we use socioeconomic and demographic data from the China Health and Nutrition Survey and implement OLS, IV and Propensity Score Matching. We find that NCMS helps lowering household savings by enhancing total consumption expenditures, in particular food consumption and bride expenses with OLS and IV estimations. However, when we implement a propensity score matching coupled with a difference-in-difference approach to control for time-invariant unobservables, these results no longer hold. Thus, the scheme does not have a disincentive effect on savings nor an incentive effect on consumption, suggesting that the implementation of the insurance is too recent in 2006 to be trusted by rural Chinese households, to reduce income risk and enable them to lower their precautionary savings.
Subjects: 
Rural China
New Cooperative Medical Scheme
Saving
Consumption Propensity Score Matching
Difference-in-Difference
JEL: 
C21
D1
I18
O53
Document Type: 
Conference Paper

Files in This Item:
The document was removed on behalf of the author(s)/ the editor(s) on: November 16, 2011
There are no files associated with this item.


Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.