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Long term care: the state and the family

Author

Listed:
  • Pierre Pestieau

    (PJSE - Paris-Jourdan Sciences Economiques - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, CREPP - Center of Research in Public Economics and Population Economics - Université de Liège, CORE - Center of Operation Research and Econometrics [Louvain] - UCL - Université Catholique de Louvain = Catholic University of Louvain, CEPR - Center for Economic Policy Research)

  • Motohiro Sato

    (Hitotsubashi University - Hitotsubashi University)

Abstract

In this paper we study the optimal design of a long term care policy in a setting that includes two types of care to dependent parents: financial assistance and assistance in time by children. The instruments are subsidies to aiding children, financed by a flat tax on earnings. The only source of heterogeneity is children's productivity. Parents can influence their children by leaving them gifts before they know whether or not they will need long term care, yet knowing the productivity of the children. The tax-transfer policy is shown to depend on its effect on parental gifts, on children's labor supply, on the distribution of wages and on consumption inequality between parents and children and between children having dependent parents and children having healthy parents.

Suggested Citation

  • Pierre Pestieau & Motohiro Sato, 2006. "Long term care: the state and the family," Post-Print halshs-00754143, HAL.
    • Handle: RePEc:hal:journl:halshs-00754143
    DOI: 10.2307/20079166
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    Cited by:

    1. Cigno, A., 2016. "Conflict and Cooperation Within the Family, and Between the State and the Family, in the Provision of Old-Age Security," Handbook of the Economics of Population Aging, in: Piggott, John & Woodland, Alan (ed.), Handbook of the Economics of Population Aging, edition 1, volume 1, chapter 0, pages 609-660, Elsevier.
    2. Helmuth Cremer & Pierre Pestieau, 2014. "Social long-term care insurance and redistribution," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 21(6), pages 955-974, December.
    3. Pestieau, Pierre & Ponthiere, Gregory, 2016. "Long-term care and births timing," Journal of Health Economics, Elsevier, vol. 50(C), pages 340-357.
    4. Canta Chiara & Pestieau Pierre, 2013. "Long-Term Care Insurance and Family Norms," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 14(2), pages 401-428, April.
    5. Cremer, Helmuth & Roeder, Kerstin, 2013. "Long-term care policy, myopia and redistribution," Journal of Public Economics, Elsevier, vol. 108(C), pages 33-43.
    6. Philippe Donder & Marie-Louise Leroux, 2017. "The political choice of social long term care transfers when family gives time and money," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 49(3), pages 755-786, December.
    7. Philippe De Donder & Marie-Louise Leroux, 2015. "The Political Economy of (in)formal Long Term Care Transfers," Cahiers de recherche 1508, Chaire de recherche Industrielle Alliance sur les enjeux économiques des changements démographiques.
    8. CREMER, Helmuth & PESTIEAU, Pierre & PONTHIERE, Grégory, 2012. "The economics of long-term care: a survey," LIDAM Discussion Papers CORE 2012030, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).

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