What is Health? Taking "Stock" (Part I)

How is health like a refrigerator?

Aug 01, 2022

As we savor the last month of summer, let's all gather around the campfire and ponder a profound philosophical question, "What is health?" Answers to this likely vary as widely as s'more toasting preferences, but this reflects the multi-faceted way that health interacts with our lives.

Over the next few lessons, we'll examine several channels of health's influence and define its "product characteristics." What kind of good is health? What section of the store would stock it?

1. Medical vs. Campfire Answers

Medical definitions of health tend to be "the absence of disease or infirmity." I'll bet your campfire answers would take on health more broadly and focus on quantity, "living a long time," or on quality, "not being sore after our hike today." Economists prefer some of the campfire insights, finding the medical definition too restrictive for understanding how health interacts with people's choices and behaviors. If health is merely the presence or absence of disease, then health's primary influence is medical care. However, as we will see in these lessons, health interacts with all aspects of economic activity, not only medical care.

A useful way to think of health is as a stock- a resource you are born with that can be augmented or depreciated along your lifetime. Think of health as a refrigerator! Refrigerators are what we call durable goods. This is a long-lasting good that throws off a flow of benefits for you, such as unmelted ice-cream, for as long as you own it. Additionally, and sadly accurate for health, durable goods also depreciate over time, particularly if they are not well-maintained.

Just look at my top-of-the-line health capital! Source: ClickAmericana.com

Let's keep in mind this idea of health as a durable good and examine how this “product” is used in two major areas of our life- production and leisure.

2. A machine for labor production

A manufacturer needs machines to produce widgets and a TikTok influencer needs the latest cellphone to amass clicks. We call these physical assets used in production capital goods. Good health functions like a capital good in producing whatever labor outputs you might specialize in, be it performing heart surgery, creating economics lectures, or choreographing a viral TikTok dance routine. Health enables you to stay sharp, be creative, and have stamina to complete on-the-job tasks.

In contrast, poor health holds you back or can even force you out of the workforce entirely. Poor health capital can be the equivalent of all machines going offline- no production will result. Look for health in the "Tools" department!

Just as the use of machines and other capital goods has changed with the economic times, the use (and abuse) of health capital has evolved over the past 100 years. In 1910, 31% of "gainful workers" were in farm occupations, compared to 1% now. In the same year, 1 in 3 nonfarm jobs were in manufacturing, compared with 1 in 10 in 2015.[3] Manual labor like farming and manufacturing and is tough on health capital, leading to joint and back problems and respiratory disease from high exposure to dust, fumes, and infectious diseases.

Health capital is better cared for in the modern workplace through two channels. First, jobs are less physically taxing. BLS data on occupational requirements shows only 60.5% of average civilian workdays require walking or standing, in contrast to construction, where 90% of days require walking or standing. In construction, 65% of jobs required either very heavy or heavy work, contrasted with only 16.9% of all civilian work fitting this description.[4]

Second, events such as the Triangle Shirtwaist Factory Fire in 1911, where 146 garment workers died largely because of unsafe working conditions, drove progressive improvements to industrial safety and worker protections. One was the establishment in 1970 of the Occupational Safety and Health Administration (OSHA), which is charged with creating and enforcing standards for safe workplaces. Both changes in the nature of work and workplace standards better protect our productive health capital compared to 100 years ago.

Fire fighters at the scene of the Triangle Shirtwaist Fire, 1911. Source: Cornell University, ILR School, Kheel Center

3. To consume!

Instead of using your health for your job, you may instead want it for the other part of your life- leisure. Health also functions like a consumption good; something that enhances your enjoyment of daily activities and brings you joy. Stock it in the aisle with the cupcake sprinkles and party supplies! Good health features prominently in advertisements of retirees kayaking and playing with their grandkids. Beer commercials of the young and energetic on an idyllic beach seem to agree as well. Our ability to consume health has also been rising over time because of its lower rate of depreciation. For example, the average age of a runner has risen from 35 to 39 since 1986[5], the Toronto Waterfront marathon was completed by a 100 year old in 2011[6], and the National Senior Games Association recently needed to add a 105 plus category in 100-meter run![7]