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Weiguang Liu
 
''Individual health perspective, income protection insurance coverage and human capital growth''
( 2020, Vol. 40 No.1 )
 
 
Health insurance in poor developing countries has long been a hot topic. Income protection insurance (IPI) is a specific form of health insurance. In an overlapping generation economy without long time saving, we compared the attitudes of individuals with different health perspective towards IPI and analyzed the impact of IPI on human capital growth. We have the following findings: (i) from the healthiest to the most unhealthy, we can divide all individuals into 4 types: the healthiest, the second healthiest, the third healthiest, and the most unhealthy, each with different attitude towards IPI and IPI will influence their human capital accumulation differently; (ii) the healthiest individuals will choose no IPI, and IPI will not influence their human capital growth; (iii) the second healthiest individuals will choose partial IPI, and IPI will decrease their human capital accumulation; (iv) the third healthiest individuals will choose full IPI and IPI will decrease their human capital accumulation, and people will choose full life insurance when the net return from education is less than zero; (v) the individuals with the worst health will choose full IPI and IPI will increase their human capital accumulation; (vi) the impact of IPI on the human capital growth of the whole economy depends on health distribution, if more individuals have extreme health, especially extreme bad health, IPI tend to enhance human capital growth of the whole economy.
 
 
Keywords: health perspective, income protection insurance, coverage, human capital growth
JEL: I1 - Health: General
I2 - Education: General
 
Manuscript Received : Sep 13 2019 Manuscript Accepted : Feb 05 2020

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