Optimal Taxation and Social Insurance with Endogenous Private Insurance

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Optimal Taxation and Social Insurance with Endogenous Private Insurance

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Title: Optimal Taxation and Social Insurance with Endogenous Private Insurance
Author: Chetty, Nadarajan; Saez, Emmanuel

Note: Order does not necessarily reflect citation order of authors.

Citation: Chetty, Raj and Emannuel Saez. 2010. Optimal taxation and social insurance with endogenous private insurance. American Economic Journal: Economic Policy 2(2): 85-116.
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Abstract: This paper characterizes the welfare gains from redistributive taxation and social insurance in an environment where the private sector provides partial insurance. We analyze stylized models in which adverse selection, pre-existing information, or imperfect optimization in private insurance markets create a role for government intervention. We derive simple formulas that map reduced-form empirical estimates into quantitative predictions for optimal tax and social insurance policy. Applications to unemployment and health insurance show that taking private market insurance into account matters significantly for optimal benefit levels given existing empirical estimates of the key parameters.
Published Version: doi:10.1257/pol.2.2.85
Other Sources: http://www.nber.org/papers/w14403.pdf
Terms of Use: This article is made available under the terms and conditions applicable to Open Access Policy Articles, as set forth at http://nrs.harvard.edu/urn-3:HUL.InstRepos:dash.current.terms-of-use#OAP
Citable link to this page: http://nrs.harvard.edu/urn-3:HUL.InstRepos:9696326

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  • FAS Scholarly Articles [7374]
    Peer reviewed scholarly articles from the Faculty of Arts and Sciences of Harvard University
 
 

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