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Mortality Contingent Claims, Health Care, and Social Insurance

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  • Tomas Philipson
  • Gary S. Becker

Abstract

This paper analyzes the savings and health care impacts of mortality contingent claims, defined here as income measures, such as annuities and life-insurance, under which earned income is contingent on the length of one's life. The postwar increase in mandatory annuity and life-insurance programs, as well as the rapid increase in life-expectancy, motivates a better understanding of the effects that mortality contingent claims have on resources devoted to life-extension. We analyze the incentives that such claims imply for life-extension when resources may affect mortality endogenously and argue that these incentives dramatically alter the standard conclusions obtained when mortality is treated exogenously.

Suggested Citation

  • Tomas Philipson & Gary S. Becker, 1996. "Mortality Contingent Claims, Health Care, and Social Insurance," NBER Working Papers 5760, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:5760
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    References listed on IDEAS

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    Cited by:

    1. Papageorgiou, Chris & Savvides, Andreas & Zachariadis, Marios, 2007. "International medical technology diffusion," Journal of International Economics, Elsevier, vol. 72(2), pages 409-427, July.
    2. Chris Papageorgiou & Andreas Savvides & Marios Zachariadis, 2004. "International Medical R&D Spillovers," Departmental Working Papers 2004-03, Department of Economics, Louisiana State University.
    3. Zsolt Becsi, 2001. "Longevity and the Life Cycle," Departmental Working Papers 2001-12, Department of Economics, Louisiana State University.
    4. Sven H. Sinclair & Kent A. Smetters, 2004. "Health Shocks and the Demand for Annuities: Technical Paper 2004-09," Working Papers 15868, Congressional Budget Office.
    5. Arthur Hau, 2001. "Precautionary Saving and Mortality-Contingent Social Insurance Programs," Public Finance Review, , vol. 29(1), pages 61-82, January.

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    JEL classification:

    • I1 - Health, Education, and Welfare - - Health

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