IDEAS home Printed from
   My bibliography  Save this paper

Longevity, genes and efforts: an optimal taxation approach to prevention


  • LEROUX, Marie-Louise
  • PESTIEAU, Pierre
  • PONTHIERE, Grégory


This paper applies the analytical tools of optimal taxation theory to the design of the optimal subsidy on preventive behaviours, in an economy where longevity varies across agents, and depends on preventive expenditures and on longevity genes. Public intervention can be here justified on three grounds: corrections for misperceptions of the survival process and for externalities related to individual preventive behaviour, and redistribution across both earnings and genetic dimensions. The optimal subsidy on preventive expenditures is shown to depend on the combined impacts of misperception, externalities and self-selection. It is generally optimal to subsidize preventive efforts to an extent depending on the degree of individual myopia, on how productivity and genes are correlated, and on the complementarity of genes and preventive efforts in the survival function.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • LEROUX, Marie-Louise & PESTIEAU, Pierre & PONTHIERE, Grégory, 2011. "Longevity, genes and efforts: an optimal taxation approach to prevention," CORE Discussion Papers RP 2309, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  • Handle: RePEc:cor:louvrp:2309 Note: In : Journal of Health Economics, 30, 62-76, 2011

    Download full text from publisher

    File URL:
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    1. A. Ludwig & A. Zimper, 2013. "A parsimonious model of subjective life expectancy," Theory and Decision, Springer, vol. 75(4), pages 519-541, October.
    2. Antoine Bommier & Marie-Louise Leroux & Jean-Marie Lozachmeur, 2011. "Differential mortality and social security," Canadian Journal of Economics, Canadian Economics Association, vol. 44(1), pages 273-289, February.
    3. Richard Blundell & Martin Browning & Costas Meghir, 1994. "Consumer Demand and the Life-Cycle Allocation of Household Expenditures," Review of Economic Studies, Oxford University Press, vol. 61(1), pages 57-80.
    4. Tomas J. Philipson & Gary S. Becker, 1998. "Old-Age Longevity and Mortality-Contingent Claims," Journal of Political Economy, University of Chicago Press, vol. 106(3), pages 551-573, June.
    5. Matteo Cervellati & Uwe Sunde, 2005. "Human Capital Formation, Life Expectancy, and the Process of Development," American Economic Review, American Economic Association, vol. 95(5), pages 1653-1672, December.
    6. Bommier, Antoine & Leroux, Marie-Louise & Lozachmeur, Jean-Marie, 2011. "On the public economics of annuities with differential mortality," Journal of Public Economics, Elsevier, vol. 95(7), pages 612-623.
    7. Jeffrey R. Brown, 2007. "Rational and Behavioral Perspectives on the Role of Annuities in Retirement Planning," NBER Working Papers 13537, National Bureau of Economic Research, Inc.
    8. Jie Zhang & Junsen Zhang & Michael Leung, 2006. "Health investment, saving, and public policy," Canadian Journal of Economics, Canadian Economics Association, vol. 39(1), pages 68-93, February.
    9. Daniel S. Hamermesh, 1985. "Expectations, Life Expectancy, and Economic Behavior," The Quarterly Journal of Economics, Oxford University Press, vol. 100(2), pages 389-408.
    10. Balia, Silvia & Jones, Andrew M., 2008. "Mortality, lifestyle and socio-economic status," Journal of Health Economics, Elsevier, vol. 27(1), pages 1-26, January.
    11. Contoyannis, Paul & Jones, Andrew M., 2004. "Socio-economic status, health and lifestyle," Journal of Health Economics, Elsevier, vol. 23(5), pages 965-995, September.
    12. Cervellati, Matteo & Sunde, Uwe, 2002. "Human Capital Formation, Life Expectancy and the Process of Economic Development," IZA Discussion Papers 585, Institute for the Study of Labor (IZA).
    13. Pierre-André Jouvet & Pierre Pestieau & Gregory Ponthiere, 2010. "Longevity and environmental quality in an OLG model," Journal of Economics, Springer, vol. 100(3), pages 191-216, July.
    14. Antoine Bommier, 2006. "Uncertain Lifetime And Intertemporal Choice: Risk Aversion As A Rationale For Time Discounting," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 47(4), pages 1223-1246, November.
    15. Bloom, David E. & Canning, David & Mansfield, Richard K. & Moore, Michael, 2007. "Demographic change, social security systems, and savings," Journal of Monetary Economics, Elsevier, vol. 54(1), pages 92-114, January.
    16. Broome, John, 2006. "Weighing Lives," OUP Catalogue, Oxford University Press, number 9780199297702, June.
    17. Helmuth Cremer & Jean-Marie Lozachmeur & Pierre Pestieau, 2010. "Collective Annuities and Redistribution," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 12(1), pages 23-41, February.
    18. repec:aph:ajpbhl:1987:77:3:307-312_7 is not listed on IDEAS
    19. Atkinson, A. B. & Stiglitz, J. E., 1976. "The design of tax structure: Direct versus indirect taxation," Journal of Public Economics, Elsevier, vol. 6(1-2), pages 55-75.
    20. Besley, Timothy, 1989. "Ex Ante Evaluation of Health States and the Provision for Ill-Health," Economic Journal, Royal Economic Society, vol. 99(394), pages 132-146, March.
    Full references (including those not matched with items on IDEAS)


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Delprat, G. & Leroux, M.-L. & Michaud, P.-C., 2016. "Evidence on individual preferences for longevity risk," Journal of Pension Economics and Finance, Cambridge University Press, vol. 15(02), pages 160-179, April.
    2. Onder,Harun & Pestieau,Pierre, 2016. "Inherited wealth and demographic aging," Policy Research Working Paper Series 7739, The World Bank.
    3. Harun Onder & Pierre Pestieau, 2016. "Aging and the Inherited Wealth of Nations," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 14(1), pages 30-36, May.
    4. Pierre Pestieau & Gregory Ponthiere, 2012. "The Public Economics of Increasing Longevity," Hacienda Pública Española, IEF, vol. 200(1), pages 41-74, March.
    5. Javier Olivera, 2013. "Old-age Support and Demographic Transition in Developing Countries. A Cultural Transmission Model," Working Papers 201307, Geary Institute, University College Dublin.
    6. Pierre Pestieau & Grégory Ponthiere, 2012. "On the Policy Implications of Changing Longevity," CESifo Working Paper Series 3926, CESifo Group Munich.
    7. Harun Onder & Pierre Pestieau, 2016. "Aging and the Inherited Wealth of Nations," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 14(1), pages 30-36, 05.

    More about this item


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cor:louvrp:2309. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Alain GILLIS). General contact details of provider: .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.