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

Canta, Chiara; Thibault, Emmanuel

doi:10.1007/s00199-016-0957-4

Cited by 21 publications

(21 citation statements)

References 32 publications

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“…Estate recovery can thus be seen as a mechanism allowing to tackle the phenomenon of private LTC insurance crowding out by public support. Our results are in line with Canta et al (2016) and more recently Fels (2019) suggesting that public LTC provision might not necessarily discourage private LTC insurance purchase.…”

Section: Tablesupporting

confidence: 91%

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Estate recovery and long‐term care insurance

Courbage

Montoliu-Montes

2020

J Public Economic Theory

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Estate recovery is a policy under which the State recovers part of LTC subsidies from the estates of deceased beneficiaries. This paper studies the effect of estate recovery on long-term care (LTC) insurance demand. This effect strongly relies on the bequest motive since the main purpose behind purchasing LTC insurance is to protect bequests from the financial costs of LTC. We find that the impact of estate recovery on LTC insurance depends on the level of parental bequests and on whether and how the parent anticipates the child's preferences with respect to informal care. More specifically, we show that estate recovery encourages the parent to purchase LTC insurance when his child is considered selfish or to like providing care. However, this policy could provide disincentives to LTC insurance purchase by the parent if his child is considered to dislike providing informal care. Our results also show that estate recovery reduces and may even eliminate public support crowding out of private LTC insurance demand. Finally, we characterise the welfare implications of financing LTC public support by estate recovery.

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Section: Tablesupporting

confidence: 91%

“…Therefore, he could have incentives to strongly increase the transfer to incentivise his child to provide more informal care and to compensate that increase by purchasing more LTC insurance. As in Canta et al (2016) public LTC financing might incentivise private LTC insurance if family help is taken into account.…”

Section: Tablementioning

confidence: 99%

Estate recovery and long‐term care insurance

Courbage

Montoliu-Montes

2020

J Public Economic Theory

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“…11 Of course, the channels through which norms can affect the process of capital formation are not restricted to tax compliance. See, for example, Canta et al (2016).…”

Section: The Economymentioning

confidence: 99%

Cultural norms, the persistence of tax evasion, and economic growth

Varvarigos

2016

Econ Theory

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I study the effects of tax evasion on economic growth by focusing on the cultural aspects of tax compliance and their effect on the extensive margin of tax evasion. A cultural norm that determines the contemptibility of tax dodging practices links the past incidence of tax evasion with the tax payers' current incentives to conceal sources of income. This dynamic complementarity may lead to multiple equilibria in the evolution of tax evasion. Due to the latter's effect on capital accumulation, this multiplicity may lead economies in divergent development paths, as long as they differ in the initial magnitude of tax evasion. This happens even though economies may be, on the outset, identical in terms of capital stock and structural characteristics, including those that govern tax enforcement. JEL Classification E62 · H26 · O41 · Z10Acknowledgements I am grateful to two anonymous referees for their valuable comments and suggestions on an earlier draft. The usual disclaimer applies.

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“…Canta et al. () show in a theoretical model that the effects of crowding out are even more complex if one allows for interactions between family assistance, private insurance, and different types of public insurance schemes. In particular, they show that if family is very important, public and private schemes can actually become complements rather than substitutes.…”

Section: Empirical Motivation and Literature Reviewmentioning

confidence: 99%

“…More recent evidence on various developing countries reveals partly striking crowding out effects (see Dercon and Krishnan, 2003;Heemskerk et al, 2004;Jensen, 2004;Juarez, 2009;Gerardi and Tsai, 2014). Canta et al (2016) show in a theoretical model that the effects of crowding out are even more complex if one allows for interactions between family assistance, private insurance, and different types of public insurance schemes. In particular, they show that if family is very important, public and private schemes can actually become complements rather than substitutes.…”

Section: Share Of Urban Populationmentioning

confidence: 99%

Redistributive pensions in the developing world

Kemmerling

Neugart

2019

Review Development Economics

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Redistributive so‐called social pension schemes have seen a remarkable surge in developing countries. These schemes often target the rural elderly and correlate with urbanization rates, urban rural‐wage differentials, and family norms. We use this stylized evidence to motivate a political economy model for a Beveridgean pension system with trade‐offs between four groups: the (poorer) rural old and young, and the (richer) urban old and young. We show under which conditions governments will install a pension system and increase its generosity as the share of the urban population rises, productivity differentials between urban and rural workers widen, or the social norm erodes. Our conclusion is that the role of the rural–urban divide in shaping redistribution merits more scholarly attention, as the gap between cities and the countryside widens in many developing countries.

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

Cited by 21 publications

References 32 publications

Estate recovery and long‐term care insurance

Estate recovery and long‐term care insurance

Cultural norms, the persistence of tax evasion, and economic growth

Redistributive pensions in the developing world

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