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Optimal prevention when coexistence matters

Author

Listed:
  • Marie-Louise Leroux

    (UQAM - Université du Québec à Montréal = University of Québec in Montréal)

  • Grégory Ponthière

    (PSE - Paris-Jourdan Sciences Economiques - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

Abstract

We study the optimal subsidy on prevention against premature death in an economy composed of two-person households, where the survival of the spouse matters, either because of self-oriented coexistence concerns or because of altruism. Under a noncooperative household model, the laissez-faire prevention levels are shown to be lower than the first-best levels, to an extent that is increasing in self-oriented coexistence concerns and decreasing in spousal altruism. The decentralization of the social optimum thus requires a subsidy on prevention depending on the precise type of coexistence concerns. Our results are shown to be globally robust to the introduction of imperfect observability of preferences, life insurance, imperfect marriage matching, and myopia. We conclude by studying the optimal prevention in a cooperative household model with unequal bargaining power.

Suggested Citation

  • Marie-Louise Leroux & Grégory Ponthière, 2013. "Optimal prevention when coexistence matters," Post-Print halshs-00835656, HAL.
    • Handle: RePEc:hal:journl:halshs-00835656
    DOI: 10.1007/s00148-012-0453-5
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    Cited by:

    1. Siew Ling Yew & Jie Zhang, 2025. "Health externalities to labor productivity and optimal policies with endogenous fertility, labor, and longevity," Journal of Population Economics, Springer;European Society for Population Economics, vol. 38(2), pages 1-42, June.
    2. Tréguier, Julie & Bonnet, Carole & Blanchet, Didier, 2025. "How Long Will You Be a Widow? Determinants, Trends, and Income Gradient in Widowhood Duration," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 62(2), pages 467-488.

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    Keywords

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    JEL classification:

    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

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