Working Paper: NBER ID: w15235
Authors: Pierre-Carl Michaud; Dana Goldman; Darius Lakdawalla; Adam Gailey; Yuhui Zheng
Abstract: In 1975, 50 year-old Americans could expect to live slightly longer than their European counterparts. By 2005, American life expectancy at that age has diverged substantially compared to Europe. We find that this growing longevity gap is primarily the symptom of real declines in the health of near-elderly Americans, relative to their European peers. In particular, we use a microsimulation approach to project what US longevity would look like, if US health trends approximated those in Europe. We find that differences in health can explain most of the growing gap in remaining life expectancy. In addition, we quantify the public finance consequences of this deterioration in health. The model predicts that gradually moving American cohorts to the health status enjoyed by Europeans could save up to $1.1 trillion in discounted total health expenditures from 2004 to 2050.
Keywords: No keywords provided
JEL Codes: I10; I38; J26
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Differences in health status (I14) | Longevity gap (J17) |
| US health trends approximating European health status (I14) | Increase in healthy life expectancy (I14) |
| US health trends approximating European health status (I14) | Decrease in unhealthy life expectancy (I14) |
| US health trends approximating European health status (I14) | Increase in overall life expectancy (J17) |
| Health deterioration of near-elderly Americans (I12) | Fiscal consequences (H39) |