TY  - RPRT
        AU  - Cawley, John
AU  - Ruhm, Christopher J.
        TI  - The Economics of Risky Health Behaviors
        PY  - 2011/May/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 5728
        UR  - https://www.iza.org/publications/dp5728
        AB  - Risky health behaviors such as smoking, drinking alcohol, drug use, unprotected sex, and poor diets and sedentary lifestyles (leading to obesity) are a major source of preventable deaths. This chapter overviews the theoretical frameworks for, and empirical evidence on, the economics of risky health behaviors. It describes traditional economic approaches emphasizing utility maximization that, under certain assumptions, result in Pareto-optimal outcomes and a limited role for policy interventions. It also details nontraditional models (e.g. involving hyperbolic time discounting or bounded rationality) that even without market imperfections can result in suboptimal outcomes for which government intervention has greater potential to increase social welfare. The chapter summarizes the literature on the consequences of risky health behaviors for economic outcomes such as medical care costs, educational attainment, employment, wages, and crime. It also reviews the research on policies and strategies with the potential to modify risky health behaviors, such as taxes or subsidies, cash incentives, restrictions on purchase and use, providing information and restricting advertising. The chapter concludes with suggestions for future research.
        KW  - income
KW  - health behaviors
KW  - alcohol
KW  - tobacco
KW  - smoking
KW  - drugs
KW  - obesity
KW  - diet
KW  - food
KW  - physical activity
KW  - public health
KW  - public policy
KW  - taxation
KW  - subsidies
KW  - addiction
KW  - externalities
KW  - advertising
KW  - information
KW  - behavioral economics
KW  - neuroeconomics
KW  - human capital
KW  - education
KW  - prices
KW  - sex
KW  - time preference
KW  - peers
KW  - bounded rationality
KW  - medical costs
KW  - employment
KW  - wages
KW  - crime
KW  - hyperbolic discounting
        ER  -