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Compensating the dead? Yes we can!

Author

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  • Marc Fleurbaey

    () (CORE - Center of Operation Research and Econometrics [Louvain] - UCL - Université Catholique de Louvain, CERSES - UMR 8137 - Centre de recherche sens, ethique, société - UPD5 - Université Paris Descartes - Paris 5 - CNRS - Centre National de la Recherche Scientifique, LSE - London School of Economics and Political Science, IDEP - Institut d'économie publique - IDEP, IEP Paris - Sciences Po Paris - Institut d'études politiques de Paris)

  • Marie-Louise Leroux

    (CORE - Center of Operation Research and Econometrics [Louvain] - UCL - Université Catholique de Louvain)

  • Grégory Ponthière

    (PSE - Paris-Jourdan Sciences Economiques - CNRS - Centre National de la Recherche Scientifique - ENPC - École des Ponts ParisTech - EHESS - École des hautes études en sciences sociales - INRA - Institut National de la Recherche Agronomique - ENS Paris - École normale supérieure - Paris, PSE - Paris School of Economics)

Abstract

An early death is, undoubtedly, a serious disadvantage. However, the compensation of short-lived individuals has remained so far largely unexplored, probably because it appears infeasible. Indeed, short-lived agents can hardly be identified ex ante, and cannot be compensated ex post. We argue that, despite the above difficulties, a compensation can be carried out by encouraging early consumption in the life cycle. In a model with heterogeneous preferences and longevities, we show how a specific social criterion can be derived from intuitive principles, and we study the corresponding optimal policy under various informational assumptions. We also study the robustness of our solution to alternative types of preferences and savings policies.

Suggested Citation

  • Marc Fleurbaey & Marie-Louise Leroux & Grégory Ponthière, 2010. "Compensating the dead? Yes we can!," PSE Working Papers halshs-00564934, HAL.
  • Handle: RePEc:hal:psewpa:halshs-00564934
    Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00564934
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    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. repec:hal:psewpa:halshs-00746913 is not listed on IDEAS
    3. Gregory Ponthiere, 2013. "Fair Accumulation under Risky Lifetime," Scottish Journal of Political Economy, Scottish Economic Society, vol. 60(2), pages 210-230, May.
    4. Grégory Ponthière, 2012. "Fair Accumulation under Risky Lifetime," Working Papers halshs-00746913, HAL.

    More about this item

    Keywords

    compensation; longevity; mortality; fairness; redistribution; justice; mortalité; longévité;

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy

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