The Joint Impact of Social Security and Medicaid on Incentives and Welfare
AbstractWe evaluate the joint effects of social security and Medicaid on labor supply, savings, economic inequality, and welfare in an environment with idiosyncratic risk in labor earnings, health expenses, and survival. The model features households consisting males and females; a progressive social security system which provides insurance against lifetime earnings, health expense, survival and spousal death risks; and a means-tested social insurance system that proxies for the US Medicaid program. We show that the annuity role of social security benefits entails important welfare gains in the presence of health expense risk and Medicaid.
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Bibliographic InfoPaper provided by Society for Economic Dynamics in its series 2012 Meeting Papers with number 967.
Date of creation: 2012
Date of revision:
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Postal: Society for Economic Dynamics Christian Zimmermann Economic Research Federal Reserve Bank of St. Louis PO Box 442 St. Louis MO 63166-0442 USA
Web page: http://www.EconomicDynamics.org/society.htm
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This paper has been announced in the following NEP Reports:
- NEP-AGE-2013-07-05 (Economics of Ageing)
- NEP-ALL-2013-07-05 (All new papers)
- NEP-DGE-2013-07-05 (Dynamic General Equilibrium)
- NEP-IAS-2013-07-05 (Insurance Economics)
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