Health insurance, agricultural production and investments.

We study the effects of health insurance coverage on agricultural production decisions, examining the causal relationships by exploiting a health care reform and providing a theoretical framework to elucidate underlying mechanisms. We find that the reform led to long-run increases in total cultivation investments and output, accompanied by a shift in households' cultivation portfolio towards riskier crops. We explain these findings using a model of agricultural investment, highlighting the important roles of health insurance in mitigating background medical expenditure risks and enhancing health.

Optimal hospital payment rules under rationing by waiting.

We derive optimal rules for paying hospitals for non-emergency care when providers choose quality and capacity, and patient demand is rationed by waiting time. Waiting for treatment is costly for patients, so that hospital payment rules should take account of their effect on waiting time as well as on quality. Since deterministic waiting time models imply that profit maximising hospitals will never choose to have both positive quality and positive waiting time, we develop a stochastic model of rationing by waiting in which both quality and expected waiting are positive in equilibrium.