Is Posner Right? An Empirical Test of the Posner Argument for Transferring Health Spending from Old Women to Old Men

Posner (1995) proposes the redistribution of health spending from old women to old men to
equalize life expectancy. His argument is based on the assumption that women’s utility is
higher if they are married. Thus, extending the lifespan of men would benefit women. Using
life satisfaction data from the German Socio-Economic Panel Study (SOEP), we conduct an
empirical test of this assumption. We apply a two-step estimation strategy: first, we use a
propensity score matching approach to generate a control group of non-widowed women.
The average level of life satisfaction in the control group serves as a reference to measure
the degree of adaptation to widowhood. In the second step, the life satisfaction trajectories of
both groups are estimated using penalized spline regressions. The results suggest
bereavement has no enduring effect on life satisfaction, and that falsifies Posner’s
assumption. Read the complete publication here.