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Order SummaryType of assignment:Review (book review, movie review)Academic level:University Level, Bachelor’sReferencing style:APANumber of sources:1Subject:EconomicsClient country:United States (US English)Assignment extract:
Hi,
Please read the article and complete summary and critique evaluation.
The main purpose of this paper has been to construct a model of the
demand for the commodity “good health.” The central proposition of the
model is that health can be viewed as a durable capital stock that produces an output of healthy time. A person determines his optimal stock
of health capital at any age by equating the marginal efficiency of this
capital to its user cost in terms of the price of gross investment. Graphically, each person has a negatively inclined demand curve for health
“!’The terms 91 and TH are equal because, by the definition of factor neutrality, E
has no effect on the ratio of the marginal product of $1 to the marginal product of TH
CONCEPT OF HEALTH CAPITAL 247
capital Answer preview:Over the past one decade, there has been demand for good health. Individuals investing in themselves to increase human capital and increase knowledge to raise their productivity in the market sector as well as household and nonmarket sector. An increase in the wage rate of an individual raises their value of an increase in the healthy time. People continue to invest heavily in good health since it is positively correlated with the benefits of reduction in time that the person loses due to an illness from the production of money. This has led to this concept being accepted in economics. Health can be thus viewed as a durable capital stock which ends up producing an output for a healthy time. By simply equating the marginal efficiency of the said capital to the user cost a person can determine his optimal stock of the health capital at any particular ageWord: 300
