TY - JOUR
T1 - Cash Holdings and Health Shocks
AU - Guariglia, Alessandra
AU - Horsewood, Nicholas
AU - Tian, Lin
N1 - Not yet published as of 22/04/2024.
PY - 2023/8/21
Y1 - 2023/8/21
N2 - We are the first to investigate how health shocks relate to cash holdings. Using three waves of the China Health and Retirement Longitudinal Study over the period 2013-2018, we document that, for middle-aged and elderly people living in rural China, the onset of an acute health condition is associated with a 3.0 percentage point higher probability of holding only cash as a safe asset, and a 2.3 percentage point higher proportion of safe assets held in the form of cash. These results are robust to using different samples and estimation methods. We also find that ex-post reimbursement of medical expenses and lack of bank accessibility may drive the association between health shocks and cash holdings.
AB - We are the first to investigate how health shocks relate to cash holdings. Using three waves of the China Health and Retirement Longitudinal Study over the period 2013-2018, we document that, for middle-aged and elderly people living in rural China, the onset of an acute health condition is associated with a 3.0 percentage point higher probability of holding only cash as a safe asset, and a 2.3 percentage point higher proportion of safe assets held in the form of cash. These results are robust to using different samples and estimation methods. We also find that ex-post reimbursement of medical expenses and lack of bank accessibility may drive the association between health shocks and cash holdings.
UR - http://onlinelibrary.wiley.com/journal/10.1111/(ISSN)1475-4991
M3 - Article
SN - 0034-6586
JO - The Review of Income and Wealth
JF - The Review of Income and Wealth
ER -