Schneider, Maik T.; Winkler, Ralph (2021). Growth and Welfare under Endogenous Lifetimes. The Scandinavian journal of economics, 123(4), pp. 1339-1384. Wiley 10.1111/sjoe.12455
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Scandinavian_J_Economics_-_2021_-_Schneider_-_Growth_and_Welfare_under_Endogenous_Lifetimes.pdf - Published Version Available under License Creative Commons: Attribution-Noncommercial-No Derivative Works (CC-BY-NC-ND). Download (250kB) | Preview |
We study the role of endogenous healthcare choices by households to extend their expected lifetimes on economic growth and welfare in a decentralized overlapping generations economy with annuitized wealth. We characterize endogenous healthcare spending in the decentralized market equilibrium and its effects on economic growth, and we identify the moral-hazard effect in healthcare investments when annuity rates are conditioned on average mortality. In a numerical simulation of our model with OECD data from 2005, we find that the moral-hazard effect can be substantial and implies sizable welfare losses of approximately 1.4–2.8 percent, depending on the share of annuitized retirement wealth.
Item Type: |
Journal Article (Original Article) |
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Division/Institute: |
03 Faculty of Business, Economics and Social Sciences > Department of Economics |
UniBE Contributor: |
Winkler, Ralph |
Subjects: |
300 Social sciences, sociology & anthropology > 330 Economics |
ISSN: |
1467-9442 |
Publisher: |
Wiley |
Language: |
English |
Submitter: |
Dino Collalti |
Date Deposited: |
28 Jan 2022 13:42 |
Last Modified: |
05 Dec 2022 16:00 |
Publisher DOI: |
10.1111/sjoe.12455 |
BORIS DOI: |
10.48350/163576 |
URI: |
https://boris.unibe.ch/id/eprint/163576 |
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