On the Redistributive Effect of Upper Benefit Limits in Bismarckian Social Insurance
This paper examines the redistributive effect of upper benefit limits (“ceilings”) in short term Bismarckian social insurance. Using data describing the Swedish sickness benefit we show that ceilings create a small redistribution at fairly high costs in terms of total utility and political sustainability. The simulation suggests that social insurance schemes with ceilings are politically more vulnerable to competition from private insurance markets than social insurance where the same amount of redistribution is produced by progressive taxes or higher universal benefits.
Volume (Year): 17 (2004)
Issue (Month): 2 (Autumn)
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- Cremer, Helmuth & Pestieau, Pierre, 2003.
"Social insurance competition between Bismarck and Beveridge,"
Journal of Urban Economics,
Elsevier, vol. 54(1), pages 181-196, July.
- CREMER, Helmuth & PESTIEAU, Pierre, "undated". "Social insurance competition between Bismarck and Beveridge," CORE Discussion Papers RP 1697, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Cremer, Helmuth & Pestieau, Pierre, 2002. "Social Insurance Competition between Bismark and Beveridge," IDEI Working Papers 141, Institut d'Économie Industrielle (IDEI), Toulouse, revised 2003.
- Cremer, H. & Pestieau, P., 2001. "Social insurance competition between Bismarck and Beveridge," CORE Discussion Papers 2001031, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Casamatta, Georges & Cremer, Helmuth & Pestieau, Pierre, 2000. "Political sustainability and the design of social insurance," Journal of Public Economics, Elsevier, vol. 75(3), pages 341-364, March.
- CASAMATTA, Georges & CREMER, Helmuth & PESTIEAU, Pierre, "undated". "Political sustainability and the design of social insurance," CORE Discussion Papers RP 1449, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- De Donder, Philippe & Hindriks, Jean, 1998. "The Political Economy of Targeting," Public Choice, Springer, vol. 95(1-2), pages 177-200, April.
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