Chen, S.; Shogren, Jason F.; Orazem, Peter

American Journal of Agricultural Economics Vol. 84 (November 2002): 990-1002.

Biomedical studies suggest that a person?s behavior matters to health, but these studies usually treat human choice as exogenous. This study shows that individual choices on nutrient intake, exercise and use of medication are influenced by exogenous food prices, wages and nonlabor income. Using these exogenous variables as instruments for endogenous behavior makes a big difference in the estimated impact of nutrient intake, exercise and medication on blood pressure. For example, application of instrumental variables methods changes the impact of sodium on blood pressure from positive to negative and significant.