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François Maréchal
''Prevention of diseases and preventive co-payment rate''
( 2009, Vol. 29 No.3 )
In this paper, we use the Rank-Dependent Expected-Utility (RDEU) model to analyse the preventive behaviour of an individual faced with the risk of being sick. The RDEU model makes it possible to take into account the way economic agents perceive the risk of being sick in the future. We first exhibit the condition under which the level of prevention chosen by the agent is higher or lower than the first best level. Then, we determine the optimal level of preventive co-payment rate which implements the first best level of prevention.
Keywords: Prevention, Co-payment rate, Rank-Dependent Expected-Utility
JEL: I1 - Health: General
D8 - Information, Knowledge, and Uncertainty: General
Manuscript Received : Mar 13 2009 Manuscript Accepted : Sep 16 2009

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