We examine the role of information in understanding the differential effects of income on the demand for health. In the health capital framework of Grossman (JPE, 1972), we derive the testable hypotheses that individuals adjust their diet in a healthier direction upon receiving negative health information, and that the effect is greater for richer individuals. Based on unique Chinese longitudinal data and a regression discontinuity design that exploits the exogenous cutoff of systolic blood pressure in the diagnosis of hypertension, we find that, upon receiving hypertension diagnosis, individuals reduce fat intake significantly, and richer individuals reduce more. Our results also indicate that among the rich, hypertension diagnosis is more effective for individuals with lower education.
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| http://dx.doi.org/10.1016/j.jhealeco.2012.11.007 | DOI Listing |
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