Date of Award

5-2018

Document Type

Dissertation

Degree Name

Doctor of Philosophy (PhD)

Department

Economics

Committee Member

Dr. Scott Barkowski, Committee Chair

Committee Member

Dr. Patrick L. Warren

Committee Member

Dr. Curtis J. Simon

Committee Member

Dr. Chungsang Tom Lam

Abstract

This dissertation examines the causal effects of health insurance on social welfare, especially Affordable Care Act (ACA) Medicaid expansion and state-dependent health in-surance mandates.

In 2010, the Affordable Care Act (ACA) was signed into law and intended to extend health coverage across the country by providing Medicaid to nearly all adults with house-hold income at or below 138 percent of the Federal Poverty Level (FPL). This expansion became effective on January 1, 2014. As of January 2017, 31 states and Washington D.C. adopted the Medicaid expansion. While the main goal of the ACA is to increase the health insurance coverage and improve the health of the population, this health insurance reform may also have effects on a broad range of non-health outcomes. The first two chapters of this dissertation investigate the effects of health insurance on criminal behaviors in the United States. In first chapter, using a one period static model of criminal behavior, I argue we should anticipate a decrease in time devoted to criminal activities in response to the expansion, since the availability of the ACA Medicaid coverage not only has a negative in-come effect on criminal behavior but also raises the opportunity cost of crime. This predic-tion is particularly relevant for the ACA expansion, because it primarily affects low-income childless adults, the population that is most likely to engage in criminal behavior. I validate this forecast using a difference-in-differences (DID) approach, estimating the expansion’s effects on a panel dataset of state- and county-level crime rates. My findings show that the ACA Medicaid expansion is negatively related to burglary, motor vehicle theft, criminal homicide, robbery, and aggravated assault. The value of this Medicaid expansion induced reduction in crime to expansion states is almost $10 billion per year.

The second chapter, which is joint work with Scott Barkowski and Joanne Song McLaughlin, examines the negative effect of increasing health insurance coverage rates on arrest rates based on state-level panels of health insurance coverage and arrest data from 2000 to 2012 in the United States. To address the endogeneity of the health insurance coverage rates with respect to arrest rates, we use plausibly exogenous variation in the pre-dicted health insurance coverage rate by using state-level health insurance mandates and the federal dependent coverage mandate in the Affordable Care Act (ACA). The instru-mental variable (IV) approach estimates indicate that an increase in the health insurance coverage rate results in a statistically significant reduction in the arrest rates of aggravated assault, prostitution and commercialized vice, but an increase in the arrest rate for fraud. Overall, the state and federal dependent health insurance mandates are associated with a sizable reduction in arrest rates. Our findings suggest that the state and federal dependent health insurance coverage mandates are effective policy instruments to increase health in-surance coverage for young adults, and the increased health insurance coverage reduces arrest rates.

The third chapter examines the effect of the Affordable Care Act (ACA) Medicaid eligibility expansion on the labor supply of low-income childless adults. In particular, I investigate that whether this effect is different between blacks and whites. I find that the Medicaid expansion decreased the labor force participation rate by approximately 3 percentage points for married whites and increased the labor supply of never-married blacks by 5.4 percentage points. However, expansion does not play a large role for other groups of blacks and whites. My finding suggests that the recent law change has different effects on the labor supply for blacks and whites.

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