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Health-care reform or labor market reform? a quantitative analysis of the Affordable Care Act

Makoto Nakajima () and Didem Tuzemen ()

No RWP 15-10, Research Working Paper from Federal Reserve Bank of Kansas City

Abstract: An equilibrium model with ?rm and worker heterogeneity is constructed to analyze labor market and welfare implications of the Patient Protection and Affordable Care Act (ACA). Our model implies a signi?cant reduction in the uninsured rate from 22.6 percent to 5.6 percent. {{p}} The model predicts a moderate positive welfare gain from the ACA, due to redistribution of income through Health Insurance Subsidies at the Exchange as well as Medicaid expansion. About 2.1 million more part-time jobs are created under the ACA, in expense of 1.6 million full-time jobs, mainly because the link between full-time employment and health insurance is weakened. The model predicts a small negative effect on total hours worked (0.36%), partly because of the general equilibrium effect.

Keywords: Health insurance; Affordable Care Act; Labor market (search for similar items in EconPapers)
JEL-codes: D91 E24 E65 I10 (search for similar items in EconPapers)
Pages: 56 pages
Date: 2015-09-01
New Economics Papers: this item is included in nep-dge, nep-hea, nep-ias and nep-mac
References: View references in EconPapers View complete reference list from CitEc
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Related works:
Working Paper: Health-care reform or labor market reform? A quantitative analysis of the affordable care act (2015) Downloads
Working Paper: Health Care Reform or Labor Market Reform? A Quantitative Analysis of the Affordable Care Act (2014) Downloads
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