Long term care and capital accumulation: the impact of the State, the market and the family

Chiara Canta (), Pierre Pestieau and Emmanuel Thibault

No 2014041, LIDAM Discussion Papers CORE from Université catholique de Louvain, Center for Operations Research and Econometrics (CORE)

Abstract: The rising level of long-term care (LTC) expenditures and their financing sources are likely to impact savings and capital accumulation and henceforth the pattern of growth. This paper studies how the joint interaction of the family, the market and the State influences capital accumulation in a society in which the assistance the children give to dependent parents is triggered by a family norm. We find that, with a family norm in place, the dynamics of capital accumulation differ from the ones of a standard Diamond (1965) model with dependence. For instance, if the family help is sizeably more productive than the other LTC financing sources, a pay-as-you-go social insurance might be a complement to private insurance and foster capital accumulation.

Date: 2014-11-05
New Economics Papers: this item is included in nep-hea
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Related works:
Journal Article: Long-term care and capital accumulation: the impact of the State, the market and the family (2016)
Working Paper: Long-term Care and Capital Accumulatn: the Impact of the State, the Market and the Family (2016)
Working Paper: Long-term care and capital accumulation: the impact of the State, the market and the family (2016)
Working Paper: Long term care and capital accumulation: the impact of the State, the market and the family (2014)
Working Paper: Long term care and capital accumulation: the impact of the State, the market and the family (2014)
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