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on Insurance Economics |
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Issue of 2015‒07‒18
ten papers chosen by Soumitra K. Mallick Indian Institute of Social Welfare and Business Management |
| By: | Hassink, Wolter (Utrecht University); Koning, Pierre (VU University Amsterdam); Zwinkels, Wim (affiliation not available) |
| Abstract: | This paper analyzes selection and incentive effects of opting out from public to private insurance on employer Disability Insurance (DI) inflow rates. We use administrative information on DI benefit costs and opting-out decisions of a balanced panel of about 140,000 employers that are observed between 2007 and 2011. We argue that the opting-out decision of employers was driven by current DI enrolment and anticipation effects that resulted from short-term expectations on DI costs. In particular, employers opted out when this was most rewarding for them in reducing DI premium rates. When controlling for these effects, our main finding is that there are no incentive effects due to opting out. Thus, publicly and privately insured employers show similar DI inflow rates. |
| Keywords: | public versus private insurance, disability insurance, opting out, longitudinal analyses |
| JEL: | C23 I13 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9181&r=ias |
| By: | AfDB AfDB |
| Date: | 2015–07–08 |
| URL: | http://d.repec.org/n?u=RePEc:adb:adbwps:2166&r=ias |
| By: | Delavallade, Clara; Dizon, Felipe; Hill, Ruth Vargas; Petraud, Jean Paul |
| Abstract: | While there is a fast-growing policy interest in offering financial products to help rural households manage risk, the literature is still scant as to which products are the most effective. In order to inform gender targeting of rural finance policy, this paper investigates which financial products best improve farmers’ productivity, resilience, and welfare, and whether benefits affect men and women equally. Using a randomized field experiment in Senegal and Burkina Faso, we compare male and female farmers who are offered index-based agricultural insurance with those who are offered a variety of savings instruments. We found that female farm managers were less likely to purchase agricultural insurance and more likely to invest in savings for emergencies, even when we controlled for access to informal insurance and differences in crop choice. We hypothesize that this difference results from the fact that although men and women are equally exposed to yield risk, women face additional sources of life cycle risk—particularly health risks associated with fertility and childcare—that men do not. In essence, the basis risk associated with agricultural insurance products is higher for women. Insurance was more effective than savings at increasing input spending and use. Those who purchased more insurance realized higher average yields and were better able to manage food insecurity and shocks. This suggests that gender differences in demand for financial products can have an impact on productivity, resilience, and welfare. |
| Keywords: | Risk, Insurance, Gender, Women, Finance, savings, economic shocks, resilience, |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:ifprid:1426&r=ias |
| By: | Tekabe Belay; Ajay Tandon |
| Abstract: | Nepal has seen impressive improvements in health outcomes and has done well both in its rate of progress and relative to its income level. Infant mortality has been declining over the past five decades to 38.6 per 1,000 live births in 2009. Similarly, maternal mortality has decreased to 380 per 100,000 live births in 2008. Life expectancy has been steadily increasing to 67 years in 2009. The rate of progress is better than those witnessed by neighboring countries. But challenges remain in addressing inequality, high and increasing out of pocket payments. Geographic and income-related inequalities in population health outcomes remain large and are increasing. For example, not only is the decline in infant mortality not uniform, some regions have seen an increase. The policy response to these challenges has been to expand free care services and pilot protection mechanism against the financial risk of ill health. There is growing demand to expand the package as well as the coverage of existing free essential health care to all Nepalese; to introduce new programs such as health insurance, and other similar initiatives This note identifies efficiency gains as the main potential source of additional fiscal space. The analysis presented herein indicates that improvement in health system efficiency i.e., getting more value for money is by far the most plausible option for realizing additional fiscal space for health in Nepal. As the note demonstrates, the prospects for additional resources for health from all other possible sources from conducive macroeconomic conditions, re-prioritization of health, external resources, and other health-sector specific sources is limited in Nepal. On the other hand, there are many indications of systemic inefficiencies in the health system of the country and the challenge would be to focus on identifying and implementing appropriate interventions to improve the situation and reduce waste. The note highlights some specific areas, such as those related to provider payments, drug procurement mechanisms, and hospital and district grant allocations whereby significant improvements in obtaining better value for money can be realized. |
| Keywords: | absenteeism, administrative management, adult mortality, Adult mortality rate, allocative efficiency, Annual reports, basic health care, budget constraint, budget process ... See More + budgetary resources, Bulletin, Cancer, capital flight, capitation, capitation payment, capitation payments, cost-effectiveness, crowding, debt, debt interest, demand for health, demand for health services, disease control, diseases, dissemination, distribution system, doctors, economic growth, economic growth rate, Economic Policy, economies of scale, efficiency gains, employment, environmental health, essential drugs, essential health care, existing resources, expenditure envelope, expenditures, expenditures on health, externalities, family planning, family planning commodities, fee for service, female education, financial barriers, financial crisis, financial position, financial protection, financial risk, fiscal conditions, fiscal policy, fiscal stability, fixed costs, forecasts, government budget, government budget constraint, government expenditure, government expenditures, government revenue, government revenues, government spending, growth rate, health care, Health Care Financing, Health Care Policy, Health Care Provider, HEALTH CARE PROVIDERS, health care services, health centers, Health Economics, health expenditure, health expenditures, health facilities, health financing, health indicators, health insurance, health insurance contributions, health insurance system, Health Organization, health outcomes, Health Policy, health posts, Health Promotion, health resources, health results, health sector, health service, health services, health share, health spending, health spending share, health status, health strategy, health system, health system efficiency, health system performance, Health Systems, health workers, health-sector, hospital, hospital beds, hospital revenues, hospitalization, hospitals, Human Development, Human Resources, ill health, illness, immunization, income, income countries, Infant, Infant mortality, infant mortality rate, infant mortality rates, informal sector, insurance premiums, interest payments, life expectancies, Life expectancy, lifestyles, live births, Living Standards, low income, macroeconomic conditions, macroeconomic environment, Malaria, maternal health, maternal mortality, Medical Care, Medical Care Expenditure, medical education, medical supplies, Millennium Development Goals, Ministry of Finance, Ministry of Health, mortality, multilateral donors, national dialogue, national goals, national health, national health insurance, national health systems, national income, National Planning, needs assessment, nurses, Nutrition, official development assistance, payment system, pocket payments, policy makers, policy response, political instability, political turmoil, Poor health, Population Discussion, potential users, Poverty Reduction, price of health care, primary care, Private financing, private hospitals, private sector, private spending, programs, progress, provider payment, provision of health services, provision of services, public expenditure, Public Expenditure on Health, public expenditure review, public expenditures, public health, public health concerns, public hospitals, public sector, public spending, quality of services, reform agenda, remittance, remittances, resource allocations, Richer countries, safe motherhood, sanitation, segments of society, service delivery, share of health spending, skilled birth attendance, social health insurance, social health insurance schemes, social insurance, social protection, teaching hospitals, tolerance, Total expenditure, total spending, transportation, Tuberculosis, Under-five mortality, urbanization, Vaccines, vulnerability, waste, workers, World Health Organization |
| Date: | 2015–04 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:hnpdps:68260&r=ias |
| By: | Itzik Fadlon; Torben Heien Nielsen |
| Abstract: | This paper studies how households respond to severe health shocks and the insurance role of spousal labor supply. In the empirical part of the paper, we provide new evidence on individuals' labor supply responses to spousal health and mortality shocks. Analyzing administrative data on over 500,000 Danish households in which a spouse dies, we find that survivors immediately increase their labor supply and that this effect is entirely driven by those who experience significant income losses due to the shock. Notably, widows – who experience large income losses when their husbands die – increase their labor force participation by more than 11%, while widowers – who are significantly more financially stable – decrease their labor supply. In contrast, studying over 70,000 households in which a spouse experiences a severe health shock but survives – for whom income losses are well-insured in our setting – we find no economically significant spousal labor supply responses, suggesting adequate insurance coverage for morbidity (vs. mortality) shocks. In the theoretical part of the paper, we develop a method for welfare analysis of social insurance using only spousal labor supply responses. In particular, we show that the labor supply responses of spouses fully identify the welfare gains from insuring households against health and mortality shocks. Our findings imply large welfare gains from transfers to survivors and identify efficient ways for targeting government transfers. |
| JEL: | H0 I1 J1 J2 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:21352&r=ias |
| By: | Helmut CREMER (Toulouse School of Economics, GREMAQ, IDEI and Insitut Universitaire de France); Catarina GOULÃO (Toulouse School of Economics, GREMAQ, INRA) |
| Abstract: | Mobility across countries is often suspected to affect the coexistence of different social insurance systems. A wide variety of social protection systems exist within the EU. Some are of Beveridgean inspiration (with universal and more or less flat benefits), while others are mainly Bismarckian (with benefits related to past contributions). Concerns about the sustainability of the most generous and redistributive (Beveridgean) insurance systems are often based on the assumption of (near) perfect and costless mobility. In reality, labor mobility remains limited. Such low levels of migration rates could, mistakenly, lead to the conclusion that migration would currently not be affecting the redistributive social insurance systems. We address this issue in a two-country setting, where mobility is costly and where individuals differ in mobility cost (attachment to their native country). A Bismarckian insurance system is not affected by migration while a Beveridgean one is. Our results suggest that the race-to-the-bottom affecting tax rates may be more important under Beveridge-Beveridge competition than under Beveridge-Bismarck competition. Finally, we study the strategic choice of the type of social protection. We show that Bismarckian governments may find it beneficial to adopt a Beveridgean insurance system. |
| Keywords: | Social Insucrance, Tax Competition, Mobility, Economic integration |
| JEL: | H23 H70 |
| Date: | 2014–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:ctl:louvre:2014011&r=ias |
| By: | Ward, Patrick S.; Spielman, David J.; Ortega, David L.; Kumar, Neha; Minocha, Sumedha |
| Abstract: | Weather-related production risks remain one of the most serious constraints to agricultural production in much of the developing world. Financial and technological innovations that mitigate these risks have the potential to greatly benefit farmers in areas prone to such risks. In this study we examine farmers’ preferences for two distinct tools that allow them to manage drought risk: weather index insurance and a recently released drought-tolerant rice variety. We illustrate how these tools can independently address drought risk and demonstrate the potential for these tools to be combined in a complementary risk management product. Using a discrete choice experiment, we assess farmers’ preferences for these two tools independently and in a bundled package. Findings indicate that farmers are generally unwilling to pay for drought-tolerant rice independent of insurance, largely due to the yield penalty under normal conditions. When bundled with insurance, however, farmers’ valuation of the rice increases. Farmers value insurance on its own, but even more so when bundled with the drought-tolerant rice variety. The results provide evidence that farmers value the complementarities inherent in a well-calibrated bundle of risk management tools. |
| Keywords: | Insurance, Risk, finance, rice, Drought tolerance, Risk management, Weather, Farmers, discrete choice experiments, |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:ifprid:1430&r=ias |
| By: | Bharadwaj, Prashant (University of California, San Diego); Lundborg, Petter (Lund University); Rooth, Dan-Olof (Linnaeus University) |
| Abstract: | We study the effect of birth weight on long-run outcomes, including permanent income, income across various stages of the lifecycle, education, social benefits take-up, and adult mortality. For this purpose, we have linked a unique dataset on nearly all Swedish twins born between 1926-1958, containing information on birth weight, to administrative records spanning nearly entire life time labor market histories. We find that birth weight positively affects permanent income and income across large parts of the life cycle, although there is some evidence of a fade out after age 50. Our results indicate that lower birth weight children are more likely to avail of social insurance programs such as unemployment and sickness insurance and that birth weight matters for adult mortality. We supplement our main analysis with more recent data, which enables us to study how the impact of birth weight on income and education of young adults has changed across cohorts born almost 50 years apart. |
| Keywords: | birth weight, early life, permanent income, unemployment sickness absence, life-cycle, mortality |
| JEL: | I10 I18 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9175&r=ias |
| By: | Pashchenko, Svetlana; Porapakkarm, Ponpoje |
| Abstract: | We document facts about medical spending of the US population using the Medical Expenditure Panel Survey dataset. We find that for the entire population, around 44% of the total medical spending is paid by private insurance but there is a substantial difference in terms of financing medical care by age: for working age adults (25 to 65 years old) private insurance covers around 57% of the total medical spending, whereas for the elderly (older than 65 years old) the largest payor is the government which covers 65% of the total. Inpatient hospital care accounts for a third of the aggregate medical expenditures. Medical spending is highly concentrated: the top 5% of spenders account for more than half of the total expenditure. Even higher concentration is observed among hospital spending where the top 5% of spenders contribute around 80% to the total expenditure. The concentration in medical spending decreases with age: the Gini coefficient of the total medical spending is 0.75 for people aged between 25 and 64 years old and 0.63 for people older than 65 years old. We find that average medical spending of people in the bottom income quintile is higher than that of people in the top income quintile for all age groups. In terms of persistence of medical spending, we find that the correlation of medical expenditure in two consecutive years is 0.36. When persistence is measured by quintile of medical spending distribution, medical spending of people in the bottom and top quintiles has higher persistence relative to other groups. |
| Keywords: | medical spending, health insurance, health care |
| JEL: | D12 I13 I14 |
| Date: | 2015–07–15 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:65630&r=ias |
| By: | Burkhauser, Richard V. (Cornell University); Daly, Mary C. (Federal Reserve Bank of San Francisco); Ziebarth, Nicolas R. (Cornell University) |
| Abstract: | Although industrialized nations have long provided public protection to working-age individuals with disabilities, the form has changed over time. The impetus for change has been multi-faceted: rapid growth in program costs; greater awareness that people with impairments are able and willing to work; and increased recognition that protecting the economic security of people with disabilities might best be done by keeping them in the labor market. Here we describe the evolution of disability programs in four countries: Germany, the Netherlands, Sweden, and the United States. We show how growth in the receipt of publically provided disability benefits has fluctuated over time and discuss how policy choices played a role. Based on our descriptive comparative analysis we summarize shared experiences that potentially benefit policymakers in all countries. |
| Keywords: | disability, disability insurance, cross-country comparison, Germany, US |
| JEL: | I10 I13 J14 J18 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9186&r=ias |