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Abstract

I study the relationship between health and development, where mechanisms linking causal effects are confounded by endogenous relationships between various determinants of health and economic outcomes. In the first paper, I study the propensity to save on permanent and transitory income shocks in South Africa, where I find that households save a portion of their permanent as well as their transitory income. Higher income households purchase more durable goods, leading these households to have a higher saving rate. In the second paper, I investigate the effect of a health shock, tuberculosis, on employment, household income and consumption. I find that the negative health shock has significant effects on job opportunities. However, household consumption is resilient in the presence of this health. In the third paper, I study the behavior of alcohol consumption in Chinese households during a period of rapid growth. I develop an empirical framework based on a recent theory extension that endogenizes health. This leads to an equation that is non-linear, where the consumption of the addictive good increases on the strength of addiction, and decreases on negative health effects. The overall effect is positively sloped, and becomes positively related at moderate levels of consumption.

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