Properties of actuarially-fair and pay-as-you-go health insurance schemes for the elderly. An OLG model approach

Per-Olov Johansson (hepoj@hhs.se)
Additional contact information
Per-Olov Johansson: Dept. of Economics, Stockholm School of Economics, Postal: Stockholm School of Economics, P.O. Box 6501, S-113 83 Stockholm, Sweden

No 231, SSE/EFI Working Paper Series in Economics and Finance from Stockholm School of Economics

Abstract: The aged dependency ratio or ADR is growing at a fast pace in many countries. This fact causes stress to the economy and might create conflicts of interest between young and old. In this paper the properties of different health insurance systems for the elderly are analysed within an overlapping generations (OLG) model. The properties of actuarial health insurance and different variations of pay-as-you-go health insurance are compared. It turns out that the welfare properties of these contracts are heavily dependent on the economy's dynamic properties. Of particular importance is the magnitude of the rate of population growth relative to the interest rate. In addition it is shown that public health insurance is associated with an inherent externality resulting in a second-best solution.

Keywords: health insurance; optimal insurance; government insurance; PAYG insurance; OLG models (search for similar items in EconPapers)
JEL-codes: H42 I18 (search for similar items in EconPapers)
Pages: 26 pages
Date: 1998-04-06
New Economics Papers: this item is included in nep-hea, nep-pbe and nep-pub
References: View complete reference list from CitEc
Citations:

Published in Journal of Health Economics, 2000, pages 477-498.

Downloads: (external link)
http://swopec.hhs.se/hastef/papers/hastef0231.pdf.zip (application/pdf)
http://swopec.hhs.se/hastef/papers/hastef0231.pdf (application/pdf)
http://swopec.hhs.se/hastef/papers/hastef0231.ps.zip (application/postscript)
http://swopec.hhs.se/hastef/papers/hastef0231.ps (application/postscript)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hhs:hastef:0231

Access Statistics for this paper

More papers in SSE/EFI Working Paper Series in Economics and Finance from Stockholm School of Economics The Economic Research Institute, Stockholm School of Economics, P.O. Box 6501, 113 83 Stockholm, Sweden. Contact information at EDIRC.
Bibliographic data for series maintained by Helena Lundin (helena.lundin@hhs.se).