Fiscal Incidence when both Individual Welfare and Family Structure Matter: The Case of Subsidization of Home-Care for the Elderly
AbstractHow should we construct incidence indexes for children and parents in the case of public subsidies for home-care of the elderly? What is the nature of a fiscal incidence index on a budgetary basis versus a theoretically more satisfactory index that is welfare-based? Can we find budgetary based measures that will serve as a proxy for incidence in welfare terms? Does the structure of the family including the altruism of children affect incidence indexes? How should fiscal shifting of the subsidy for home care paid to the parents be defined, in budgetary or in welfare terms, and what does simulation tell us about the distribution of benefits between the generations? We address these issues analytically and with simulation (using data from the Medical Expenditure Panel Survey) in this contribution to the study of fiscal incidence. The definition of welfare incidence, the comparison of welfare-based incidence with budgetary incidence for non-cooperative and cooperative families, and the calculation of the shifting of program benefits between family members, some of whom may be altruistic, are key issues in the analysis. The integration of individual welfare, family structure and benefit shifting provides a new perspective on the fiscal incidence of home care programs.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 3731.
Date of creation: 2012
Date of revision:
home care of the elderly; price-subsidy; fiscal incidence index; non-cooperative family; cooperative family; income pooling; altruism; benefit shifting; Medical Expenditure Panel Survey; Medicaid; simulation;
Find related papers by JEL classification:
- H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
- I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
- D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Pierre Pestieau & Motohiro Sato, 2008.
"Long-Term Care: the State, the Market and the Family,"
London School of Economics and Political Science, vol. 75(299), pages 435-454, 08.
- PESTIEAU, Pierre & SATO, Motohiro, 2004. "Long term care: the state, the market and the family," CORE Discussion Papers 2004082, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Becker, Gary S, 1981. "Altruism in the Family and Selfishness in the Market Place," Economica, London School of Economics and Political Science, vol. 48(189), pages 1-15, February.
- Schwarze, Johannes & Winkelmann, Rainer, 2005.
"What Can Happiness Research Tell Us About Altruism? Evidence from the German Socio-Economic Panel,"
IZA Discussion Papers
1487, Institute for the Study of Labor (IZA).
- Johannes Schwarze & Rainer Winkelmann, 2005. "What Can Happiness Research Tell Us about Altruism?: Evidence from the German Socio-Economic Panel," Discussion Papers of DIW Berlin 475, DIW Berlin, German Institute for Economic Research.
- Johannes Schwarze & Rainer Winkelmann, 2005. "What can happiness research tell us about altruism? Evidence from the German Socio-Economic Panel," Working Papers 0503, University of Zurich, Socioeconomic Institute, revised Sep 2005.
- David Byrne & Michelle S. Goeree & Bridget Hiedemann & Steven Stern, 2009. "Formal Home Health Care, Informal Care, And Family Decision Making," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 50(4), pages 1205-1242, November.
- Peter C. Coyte & Mark Stabile, 2001.
"Household Responses to Public Home Care Programs,"
NBER Working Papers
8523, National Bureau of Economic Research, Inc.
- Donald Cox & Bruce E. Hansen & Emmanuel Jimenez, 1997.
"How Responsive are Private Transfers to Income? Evidence from a Laissez-Faire Economy,"
Boston College Working Papers in Economics
341., Boston College Department of Economics, revised 01 Dec 1999.
- Cox, Donald & Hansen, Bruce E. & Jimenez, Emmanuel, 2004. "How responsive are private transfers to income? Evidence from a laissez-faire economy," Journal of Public Economics, Elsevier, vol. 88(9-10), pages 2193-2219, August.
- Gueth, W. & Offerman, T. & Potter, J. & Strobel, M., 2002.
"Are family transfers crowded out by public transfers?","
Open Access publications from Maastricht University
urn:nbn:nl:ui:27-4951, Maastricht University.
- Güth, W. & Offerman, T.J.S. & Potters, J.J.M. & Strobel, M. & Verbon, H.A.A., 2002. "Are family transfers crowded out by public transfers?," Open Access publications from Tilburg University urn:nbn:nl:ui:12-91498, Tilburg University.
- Konrad, K.A. & Lommerud, K.E., 2000.
"The Bargaining Family Revisited,"
Norway; Department of Economics, University of Bergen
212, Department of Economics, University of Bergen.
- Alessandro Balestrino, 2004. "Revisiting the Equity-Efficiency Trade-off: Taxation with Non-Cooperative Families," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 60(4), pages 515-, December.
- Browning, Edgar K, 1978. "The Burden of Taxation," Journal of Political Economy, University of Chicago Press, vol. 86(4), pages 649-71, August.
- Aaron, Henry & McGuire, Martin, 1970. "Public Goods and Income Distribution," Econometrica, Econometric Society, vol. 38(6), pages 907-20, November.
- Tarja Viitanen, 2007.
"Informal And Formal Care In Europe,"
2007010, The University of Sheffield, Department of Economics, revised Jun 2007.
- Orsini, Chiara, 2010. "Changing the way the elderly live: Evidence from the home health care market in the United States," Journal of Public Economics, Elsevier, vol. 94(1-2), pages 142-152, February.
- Anderberg, Dan & Balestrino, Alessandro, 2001.
"Self-Enforcing Intergenerational Transfers and the Provision of Education,"
CEPR Discussion Papers
3107, C.E.P.R. Discussion Papers.
- Dan Anderberg & Alessandro Balestrino, 2003. "Self--enforcing Intergenerational Transfers and the Provision of Education," Economica, London School of Economics and Political Science, vol. 70(277), pages 55-71, February.
- Chen, Zhiqi & Woolley, Frances, 2001.
"A Cournot-Nash Model of Family Decision Making,"
Royal Economic Society, vol. 111(474), pages 722-48, October.
- Cigno, Alessandro, 2005.
"A Constitutional Theory of the Family,"
IZA Discussion Papers
1797, Institute for the Study of Labor (IZA).
- Liliana E. Pezzin & Robert A. Pollak & Barbara S. Schone, 2007.
"Efficiency in Family Bargaining: Living Arrangements and Caregiving Decisions of Adult Children and Disabled Elderly Parents,"
CESifo Working Paper Series
1908, CESifo Group Munich.
- Liliana E. Pezzin & Robert A. Pollak & Barbara S. Schone, 2007. "Efficiency in Family Bargaining: Living Arrangements and Caregiving Decisions of Adult Children and Disabled Elderly Parents," CESifo Economic Studies, CESifo, vol. 53(1), pages 69-96, March.
- Liliana E. Pezzin & Robert A. Pollak & Barbara S. Schone, 2006. "Efficiency in Family Bargaining: Living Arrangements and Caregiving Decisions of Adult Children and Disabled Elderly Parents," NBER Working Papers 12358, National Bureau of Economic Research, Inc.
- Martinez-Vazquez, Jorge, 1982. "Fiscal Incidence at the Local Level," Econometrica, Econometric Society, vol. 50(5), pages 1207-18, September.
- Shoup, Carl S, 1988. "Distribution of Benefits from Government Services: Horizontal Equity," Public Finance = Finances publiques, , vol. 43(1), pages 1-18.
- Becker, Gary S, 1974.
"A Theory of Social Interactions,"
Journal of Political Economy,
University of Chicago Press, vol. 82(6), pages 1063-93, Nov.-Dec..
- Dan Anderberg & Alessandro Balestrino, 2011. "Public Spending and Taxation with Non-cooperative Families," CESifo Economic Studies, CESifo, vol. 57(2), pages 259-282, June.
- Patricia Apps & Ray Rees, 2007. "Household Models: An Historical Perspective," CESifo Working Paper Series 2172, CESifo Group Munich.
- Piggott, John & Whalley, John, 1987. "Interpreting Net Fiscal Incidence Calculations," The Review of Economics and Statistics, MIT Press, vol. 69(4), pages 685-94, November.
- Hoerger, Thomas J. & Picone, Gabriel & Sloan, Frank, 1995.
"Public Subsidies, Private Provision of Care, and Living Arrangements of the Elderly,"
95-22, Duke University, Department of Economics.
- Hoerger, Thomas J & Picone, Gabriel A & Sloan, Frank A, 1996. "Public Subsidies, Private Provision of Care and Living Arrangements of the Elderly," The Review of Economics and Statistics, MIT Press, vol. 78(3), pages 428-40, August.
- Xu, Zeyu, 2007. "A survey on intra-household models and evidence," MPRA Paper 3763, University Library of Munich, Germany.
- Shelly Lundberg & Robert A. Pollak, 1996. "Bargaining and Distribution in Marriage," Journal of Economic Perspectives, American Economic Association, vol. 10(4), pages 139-158, Fall.
- Laura Juarez, 2007. "Altruism, Exchange and Crowding Out of Private Support to the Elderly: Evidence from a Demogrant in Mexico," Working Papers 0707, Centro de Investigacion Economica, ITAM.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Julio Saavedra).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.