Venue: The Fuqua School of Business, Duke University, 1 Towerview Drive, Durham, NC 27708-0120

 

Presentation

A Bayesian Analysis of the OPES Model with a Non-parametric Component: Application to Dental Insurance and Dental Care

Authors: Murat K. Munkin (University of South Florida)

Presenter: Pravin K. Trivedi (Indiana University)

Discussant: Frank Windmeijer (University of Bristol)

Session: Selection, Endogenous Regressors and Non-linear Response Models

Room: Classroom E

When: Monday 10:30 a.m. - noon

This paper analyzes the effect of dental insurance on utilization of general dentist services by adult US population aged from 25 to 64 years using the ordered probit model with endogenous selection (OPES). Our econometric framework accommodates endogeneity of insurance and the ordered nature of the measure of dental utilization. The study finds strong evidence of endogeneity of dental insurance to utilization and identifies interesting patterns of nonlinear dependencies between the dental insurance status and individuals' age and income. The calculated average treatment effect supports the claim of adverse selection into the treated (insured) state and indicates a strong positive incentives effect of dental insurance.