Government and Health Outcomes

In this paper, I summarize the results of empirical studies in the areas of schooling and health, public programs and infant mortality, and government regulation of teenage smoking. My review is selective and is based on my own research. It is neutral with respect to the question of whether the government should pursue policies to improve the health of its citizens. But it calls attention to the consequences with respect to health of alternative decisions by policy makers.

A Survey of Recent Research in Health Economics

In this survey of recent research in health economics, I concentrate on studies that have appeared since 1971 or are in progress. The survey reflects in part my own research interests and biases and is not meant to be comprehensive. Four topics are covered: (1) demand for adults' health and medical care; (2) effects of health on labor supply and wage rates; (3) demand for children's health and medical care and (4) selected topics pertaining to the supply side of the medical care market.

Beer Taxes, the Legal Drinking Age, and Youth Motor Vehicle Fatalities

Based on a time series of state cross sections for the period from 1975 through 1981, we find that motor vehicle accident mortality rates of youths ages 15 through 17, 18 through 20, and 21 through 24 are negatively related to the real beer excise tax. We also find that the death rate of 18 through 20 year olds is inversely related to the minimum legal age for the purchase of beer. Simulations suggest that the lives of 1,022 youths between the ages of 18 and 20 would have been saved in a typical year during the sample period if the Federal excise tax rate on beer, which has been fixed in nominal terms since 1951, had been indexed to the rate of inflation since 1951. This represents a 15 percent decline in the number of lives lost in fatal crashes. The simulations also suggest that the lives of 555 youths per year would have been saved if the drinking age had been 21 in all states of the U.S. These figures indicate that, if reductions in youth motor vehicle accident deaths are desired, both a uniform drinking age of 21 and an increase in the Federal excise tax rate on beerare effective policies to accomplish this goal. They also indicate that the tax policy may be more potent than the drinking age policy.