Private, social and self insurance for longterm care: a political economy analysis

Philippe De Donder and Pierre Pestieau

No 11-305, TSE Working Papers from Toulouse School of Economics (TSE)

Abstract: We study the political determination of the level of social long-term care insurance when voters also choose private insurance and saving amounts. Agents di§er in income, probability of becoming dependent and of receiving family help. Social insurance redistributes across income and risk levels, while private insurance is actuarially fair. The income-to-risk ratio of agents determines whether they prefer social or private insurance. Family support crowds out the demand for both social and, especially, private insurance, as strong prospects of family help drive the demand for private insurance to zero. The availability of private insurance decreases the demand for social insurance but need not decrease its majority chosen level.

Keywords: long-term care; social insurance; familism; crowding out; weak and strong prospects of family help; voting (search for similar items in EconPapers)
JEL-codes: D72 I13 J14 (search for similar items in EconPapers)
Date: 2011-12, Revised 2014-06
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Related works:
Working Paper: Private, social and self insurance for longterm care: a political economy analysis (2014)
Working Paper: Private, social and self insurance for long-term care: A political economy analysis (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:tse:wpaper:25822

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