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on Insurance Economics |
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Issue of 2020‒02‒24
thirteen papers chosen by Soumitra K. Mallick Indian Institute of Social Welfare and Business Management |
| By: | Naoki Aizawa; Chao Fu |
| Abstract: | We study regulations on the health insurance system for working-age U.S. households, consisting of employer-sponsored health insurance (ESHI), individual health insurance exchange (HIX), and Medicaid. We develop and estimate an equilibrium model with rich heterogeneity across local markets, households, and firms, which highlights the inter-relationship between various components of the health insurance system as well as their relationship with the labor market. We estimate the model exploiting variations across states and policy environments before and after the Affordable Care Act. In counterfactual experiments, we consider policies to cross subsidize between ESHI and HIX, which include pure risk pooling between the two markets as a special case. We find such policies would benefit most households, improve average household welfare, and decrease government expenditure. Furthermore, the welfare gains are larger if the cross subsidization is interacted with Medicaid expansion. |
| JEL: | I11 J01 |
| Date: | 2020–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:26713&r=all |
| By: | Nicole Dussault (Research and Statistics Group); Basit Zafar (Bank of Italy; Federal Reserve Bank of New York; Forschungsinstitut zur Zukunft der Arbeit; Arizona State University); Maxim L. Pinkovskiy |
| Abstract: | What is the purpose of health care? What is the purpose of health insurance? When people fall ill, they seek health care in order to get better. But insurance has a slightly different function: Its main role is not to protect our health per se, but to protect our finances. For most people, lifetime health expenditures are quite low. However, some people have enormous health costs owing to major illnesses or health conditions. And this is where health insurance comes in?its goal (like that of any other form of insurance) is to protect these individuals against large, and sometimes ruinous, health expenditures. Has the recent health reform served this purpose? |
| Keywords: | Affordable Care Act; Medicaid; Consumer Credit Panel; collections |
| JEL: | D1 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fednls:87135&r=all |
| By: | Maya Bidanda (Research and Statistics Group); Sean Hundtofte; Maxim L. Pinkovskiy; Rajashri Chakrabarti |
| Abstract: | The Patient Protection and Affordable Care Act (ACA) is arguably the biggest policy intervention in health insurance in the United States since the passage of Medicaid and Medicare in 1965. The Act was signed into law in March 2010, and by 2016 approximately 20 to 24 million additional Americans were covered with health insurance. Such an extension of insurance coverage could affect not only medical bills, but also educational, employment, and broader financial outcomes. In this post, we take an initial look at the relationship between the ACA and higher education financing choices and outcomes. We find evidence that expansions in healthcare coverage may influence both the prevalence of student loans and loan repayment behavior. Specifically, our results suggest that individuals covered by ACA-related expansions are taking out slightly more loans and taking a longer time to start repayment. |
| Keywords: | Employment; Student Loans; Insurance; Higher Education; ACA; Default |
| JEL: | I1 I2 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fednls:87248&r=all |
| By: | Arandara,Rathnija; Gunasekera,Shanuki; Mookerjee,Agrotosh |
| Abstract: | This paper documents the practical experience of deploying index insurance in a tropical country whose agriculture is dependent on dual sources of water: rainfall and irrigation. The paper introduces an innovative hybrid index insurance product based on the authors'experience of piloting the concept. The hybrid product was created to address the higher basis risk of using a single rainfall trigger that ignores the hydrological conditions on the ground. The paper brings forth findings from a live pilot in selected locations -- with varied agro-climatic conditions?in Sri Lanka under the World Bank Group's Global Index Insurance Facility. The findings indicate that the new hybrid product performs better than the single trigger (rainfall-based) index insurance product, thereby reducing the basis risk faced by farmers. The paper also shares some of the practical limitations in deploying the product. |
| Keywords: | Hydrology,Natural Disasters,Food Security,Water and Food Supply,Town Water Supply and Sanitation,Small Private Water Supply Providers,Water Supply and Sanitation Economics,Water and Human Health |
| Date: | 2019–11–07 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:9055&r=all |
| By: | Yang Lu (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - Ecole Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | We propose a flexible regression model that is suitable for mixed count-continuous panel data. The model is based on a compound Poisson representation of the continuous variable , with bivariate random effect following a polynomial-expansion-based joint density. Besides the distributional flexibility that it offers, the model allows for closed form forecast updating formu-lae.This property is especially important for insurance applications, in which the future individual insurance premium should be regularly updated according to one's own past claim history. An application to vehicle insurance claims is provided. |
| Keywords: | Sequential forecasting and pricing,Mixed data,polynomial expansion,random effect,sequential forecast- ing/pricing |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-02419024&r=all |
| By: | Elzir Assy, Angela (World Bank); Ribeiro, Tiago (World Bank); Robalino, David A. (World Bank); Rosati, Furio C. (University of Rome Tor Vergata); Sanchez Puerta, Maria Laura (World Bank); Weber, Michael (World Bank) |
| Abstract: | This paper presents the main results of three Discrete Choice Experiments designed to estimate youth preferences for different jobs attributes, and their willingness to pay for support services to access wage or self-employment. The experiments took place in urban areas in Kenya. We find that youth, in general, prefer to work in jobs that have the attributes of formal employment regardless of the tasks involved. Thus, they value earning stability, access to social insurance (in particular health insurance), and adequate working conditions. They do not have well defined preferences though between analytical vs. manual repetitive tasks or tasks that involve interpersonal/organizational skills or creativity. The main services youth demand to facilitate access to wage employment include jobs search assistance and training on soft-skills, followed by OJT and wage subsidies; they are not interested in technical training. For self-employment, they mainly seek support accessing credit, inputs and equipment, and insurance. Their willingness to pay for these services is modest relative to the average per capita cost of ALMPs, but it represents a substantial share of the payments made to youth and employers who participate in these programs. |
| Keywords: | youth employment, ALMP, discrete choice experiment |
| JEL: | J2 J6 |
| Date: | 2019–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12864&r=all |
| By: | Guner, Nezih (CEMFI, Madrid); Kulikova, Yuliya (Banco de España); Valladares-Esteban, Arnau (University of St. Gallen) |
| Abstract: | The added worker effect (AWE) measures the entry of individuals into the labor force due to their partners' job loss. We propose a new method to calculate the AWE, which allows us to estimate its effect on any labor market outcome. We show that the AWE reduces the fraction of households with two non-employed members. The AWE also accounts for why women's employment is less cyclical and more symmetric compared to men. In recessions, while some women lose their employment, others enter the labor market and find jobs. This keeps the female employment relatively stable. |
| Keywords: | household labor supply, intra-household insurance, female employment, cyclicality, skewness |
| JEL: | D1 E32 J21 J22 |
| Date: | 2020–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12923&r=all |
| By: | Irene Selwaness (Cairo University); Maye Ehab (University of Bamberg, Bamberg, Germany) |
| Abstract: | This paper presents a comprehensive review of the state of social protection in Egypt using data from the Egypt Labor Market Panel Surveys of 1998, 2006, 2012 and 2018. First, we focus on issues of social insurance coverage at work, how it evolved over time, and the time it takes to acquire social insurance. Second, we examine the patterns of social protection benefits receipt at the household level. We analyze the coverage of the newly launched conditional cash transfer programs Takaful and Karama as well as the smart food ration cards. Finally, as a component of social protection, we examine health insurance coverage rates. Findings suggest that the social insurance coverage gap widened among all workers, particularly in private sector wage employment, for both men and women. This was likely due to the expansion of outside of establishment wage work, highlighting issues of increased vulnerability at work. Moreover, the coverage gap does not close with years of work and is highly contingent on the type of first job, suggesting an informality trap. As for social protection benefits receipt, the most common type of benefits was retirement or social assistance pensions. If the social insurance coverage gap continues to widen, such benefits receipt would be strongly affected. Finally, women, and in particular rural women, as well as youth aged 20-24 were the most vulnerable in terms of health insurance coverage. |
| Date: | 2019–10–20 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1363&r=all |
| By: | Klapper,Leora; Singer,Dorothe; Ansar,Saniya; Hess,Jake Richard |
| Abstract: | The ability to manage financial risk is especially important for people earning their living through agriculture. Many farmers only get paid once or twice a year, and households need to stretch their earnings across the year by saving or borrowing money. Moreover, agricultural production faces a variety of risks related to both production and markets because of their exposure to weather and disease shocks. Households engaged in agriculture may thus especially benefit from financial inclusion?access to and use of formal financial services. This paper explores the topic of financial risk management in agriculture?how adults who rely on growing crops or raising livestock as their household's main source of income manage financial risk and use financial services. The paper summarizes new data based on a nationally representative survey of about 15,000 adults in 15 lower-middle- and low-income Sub-Saharan African economies collected as part of the World Bank's Global Findex database. The majority of these adults reported suffering a bad harvest or significant livestock loss in the past five years, and most bear the entire financial risk of such a loss. Most adults in agricultural households lack the financial tools -- such as insurance, accounts, savings, and credit -- that could help them manage financial risks. |
| Keywords: | Livestock and Animal Husbandry,Crops and Crop Management Systems,Climate Change and Agriculture,Food Security,Financial Sector Policy |
| Date: | 2019–12–11 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:9078&r=all |
| By: | Bart Cockx; Koen Declercq; Muriel Dejemeppe; Leda Inga; Bruno Van der Linden (-) |
| Abstract: | This paper evaluates the impact on the transition to work of a policy reform in Belgium that restricted the access to a specific unemployment insurance scheme for young labor market entrants. This scheme entitles youths with no or little labor market experience to unemployment benefits after a waiting period of one year. As of 2015, the Belgian government unexpectedly scrapped benefit eligibility for youths who start the waiting period at the age of 24 or older. The reform implied a change from an inclining to a flat rate (zero-level) benefit profile. We use a difference-in-differences approach to identify the causal impact of this reform on fresh university graduates. Our main finding is that this reform only increases the transition to very short-lived jobs. |
| Keywords: | Youth unemployment, Unemployment insurance, Policy evaluation, Difference-indifferences |
| JEL: | J64 J65 J68 |
| Date: | 2020–02 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:20/991&r=all |
| By: | Marina Moretti; Marc C Dobler; Alvaro Piris Chavarri |
| Abstract: | This paper updates the IMF’s work on general principles, strategies, and tech-niques from an operational perspective in preparing for and managing sys-temic banking crises in light of the experiences and challenges faced during and since the global financial crisis. It summarizes IMF advice concerning these areas from staff of the IMF Monetary and Capital Markets Department (MCM), drawing on Executive Board Papers, IMF staff publications, and country documents (including program documents and technical assistance reports). Unless stated otherwise, the guidance is generally applicable across the IMF membership. |
| Keywords: | Systemic crisis management;Banking crisis;Bank resolution;Bank restructuring;Lender of last resort;Deposit insurance;Non-performing loans;Asset management companies;Systemically important financial institutions;Financial crises;Financial institutions;Macroprudential policies and financial stability;Financial instruments;Systemic crisis,financial crisis,crisis containment,nonperforming loan management,asset management company,DPPP,GFC,depositor,ELA,financial safety net,systemwide |
| Date: | 2020–02–11 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfdep:20/05&r=all |
| By: | Gina A. Livermore; Jody Schimmel Hyde; Yonatan Ben-Shalom; Todd Honeycutt; David C. Stapleton |
| Abstract: | This article summarizes selected findings from work conducted under the Social Security Administration’s Disability Research Consortium by researchers at the Mathematica Center for Studying Disability Policy (CSDP). |
| Keywords: | Disability, Disability Research Consortium, Social Security, SSDI, SSI |
| URL: | http://d.repec.org/n?u=RePEc:mpr:mprres:a039e097b5054717b60ed7d13c895b43&r=all |
| By: | Jacob Pastor-Paz (Victoria University of Wellington); Ilan Noy (Victoria University of Wellington); Isabelle Sin (Motu Economic and Public Policy Research); Abha Sood (National Institute of Water and Atmospheric Research (NIWA)); David Fleming-Munoz (Commonwealth Scientific and Industrial Research Organization (CSIRO)); Sally Owen (Victoria University of Wellington) |
| Abstract: | New Zealand’s public insurer, the Earthquake Commission (EQC), provides residential insurance for some weather-related damage. Climate change and the expected increase in intensity and frequency of extreme weather-related events are likely to translate into higher damages and thus an additional financial liability for the EQC. We project future insured damages from extreme precipitation events associated with future projected climatic change. We first estimate the empirical relationship between extreme precipitation events and the EQC’s weather-related insurance claims based on a complete dataset of all claims from 2000 to 2017. We then use this estimated relationship, together with climate projections based on future greenhouse gases concentration scenarios from six different dynamically downscaled Regional Climate Models, to predict the impact of future extreme precipitation events on EQC liabilities for different time horizons up to the year 2100. Our results show predicted adverse impacts that vary -increase or decrease over time and space. The percent change between projected and past damages—the climate change signal—ranges between an increase of 7% and 8% higher in the period 2020 to 2040, and between 9% and 25% higher in the period 2080 to 2100. We also provide detail caveats as to why these quantities might be mis-estimated. The projected increase in the public insurer’s liabilities could also be used to inform private insurers, regulators, and policymakers who are assessing the future performance of both the public and private insurers that cover weather-related risks in the face of climatic change. We combine firm-level innovation data with area-level Census data to examine the relationship between local workforce characteristics, especially the presence of immigrants and local skills, and the likelihood of innovation by firms. We examine a range of innovation outcomes, and test the relationship for selected subgroups of firms. We find a positive relationship between local workforce characteristics and average innovation outcomes in labour market areas, but this is accounted for by variation in firm characteristics such as firm size, industry, and research and development expenditure. Controlling for these influences, we find no systematic evidence of an independent link between local workforce characteristics and innovation. |
| Keywords: | Insurance, precipitation, climate change, extreme weather-events, loss projection |
| JEL: | Q54 |
| Date: | 2020–02 |
| URL: | http://d.repec.org/n?u=RePEc:mtu:wpaper:20_02&r=all |