SA4N7      Half Unit
Economics of Health and Wellbeing

This information is for the 2015/16 session.

Teacher responsible

Dr Grace Lordan M 2.26

Some lectures will be taken by Professor Andrew Clark ( Andrew currently has a partial appointment at the LSE in CEP. 


This course is available on the Executive MSc in Health Economics, Policy and Management. This course is not available as an outside option.


To have progressed from year 1 of the MSc in Health Economics, Policy and Management into year two students will have passed SA4E1 Health Administration and Management, SA4E2 Resource Allocation and Cost-effectiveness Analysis, SA4G1 Financing Health Care and SA4G2 Health Economics.

Course content

Overall the lectures will follow the following structure:

1. Lecture 1 Introduction 

2. Lecture 2 Measurement

3. Lecture 3: Determinants of wellbeing 

4. Lecture 4: Determinants of health with a focus on the income/health gradient

5. Lecture 5: Determinants of unhealthy behaviours (drinking, smoking, drug taking, obesity) with a focus on peer effects

6. Lecture 6: Causal Evidence on the determinants of health and wellbeing

In addition, we will have four seminar sessions that will complement these lectures. The following lectures map to individual seminars: (1 and 2), (3), (4) and (5)

This course is being convened by Dr Grace Lordan and will introduce students to the economics of health and wellbeing. Focus will be on the health or wellbeing production function, and the related economics literature. In particular, the course will cover how health and wellbeing are measured in the literature and factors that determine these outcomes. Attention will be paid to defining what a causal effect is and specifying an appropriate health production function.  In this regard the student can expect to become familiar with some basic econometrics. In terms of measurement, we will consider the value of subjective versus objective outcomes. We will discuss the human development index and the Millennium development goals.  In addition, the course will review the main determinants of physical health, including inequality. (Un)healthy behaviours will also be covered, including drug taking, obesity and smoking. Some attention will be paid to the role of peer effects in this regard.  The course will also cover well-being, income comparisons and the Easterlin Paradox. This component will be taken by Professor Andrew Clark who is an affiliate with the Wellbeing group at the CEP.  Overall, students taking this course can expect to gain insight as to the challenges faced by policy makers in altering the health and wellbeing outcomes of a nation. Students will also gain some insight into policies that are likely to be the most fruitful. Students will also become more familiar with a literature that considers individual health and wellbeing. This course will be complementary to the content covered in Advanced Health Economics and Valuing Health and Behaviour. However, there is no overlap and this course can also be taken on its own.  


18 hours of lectures and 8 hours of seminars in the ST.

This course will be a combination of lectures- where students learn theory- and seminars- where students apply what they have learned. 

Formative coursework

Students will be expected to produce 1 exercise in the ST.

Indicative reading

Main Readings: 


1. The Economics Of Excess (2011) by Harold Winter 

2. Mastering 'Metrics: The Path from Cause to Effect (2014) by Joshua D. Angrist, Jörn-Steffen Pischke

3. The Great Escape: Health, Wealth, and the Origins of Inequality (2013)  Angus Deaton (for lecture: 


1. Healthy Bodies and Thick Wallets: The Dual Relation between Health and Economic Status James P. Smith The Journal of Economic Perspectives, Vol. 13, No. 2 (Spring, 1999), pp. 145-166

2. Preston, S. H (1975). "The Changing Relation between Mortality and Level of Economic Development". Population Studies 29 (2): 231–248.)

3.  “Relative Income, Happiness and Utility: An Explanation for the Easterlin Paradox and Other Puzzles” Andrew Clarke, Paul Frijters and Mike Shields, Journal of Economic Literature, (March 2008), Vol.46, no.1, pp.95-144.

Optional Readings: 

4. “Happy House: Spousal Weight and Individual Well-Being”, Andrew Clarke and Fabrice Etilé, Journal of Health Economics, (2011), Vol.30, no.5, pp. 1124-1136.

5. Johnston, David W. and Lordan, Grace (2012) Discrimination makes me sick! An examination of the discrimination–health relationship Journal of Health Economics, 31 (1). 99-111. ISSN 0167-6296.


Take home exam (100%) in the MT.

The exam will be take home. Formative feedback will be provided on a piece of work similar to this. 

Key facts

Department: Social Policy

Total students 2014/15: Unavailable

Average class size 2014/15: Unavailable

Controlled access 2014/15: No

Value: Half Unit

Guidelines for interpreting course guide information

Personal development skills

  • Leadership
  • Self-management
  • Team working
  • Problem solving
  • Application of information skills
  • Communication
  • Application of numeracy skills
  • Specialist skills