Article

Long-Term Care Insurance: Information Frictions and Selection

Martin Boyer, Philippe De Donder, Claude Fluet, Marie-Louise Leroux et Pierre-Carl Michaud

Résumé

This paper conducts a stated-choice experiment where respondents are asked to rate various insurance products aimed to protect against nancial risks associated with long-term care needs. Using exogenous variation in prices from the survey design and individual cost estimates, these stated-choice probabilities are used to predict market equilibrium for long-term care insurance. Our results are twofold. First, information frictions are pervasive. Second, measuring the welfare losses associated with frictions in a framework that also allows for selection, it is found that information frictions reduce equilibrium take-up and lead to large welfare losses while selection plays little role.

Mots-clés

Long-term care insurance, adverse selection, stated-preference, health, insurance;

Remplace

Martin Boyer, Philippe De Donder, Claude Fluet, Marie-Louise Leroux et Pierre-Carl Michaud, « Long-Term Care Insurance: Information Frictions and Selection », TSE Working Paper, n° 19-1034, septembre 2019.

Référence

Martin Boyer, Philippe De Donder, Claude Fluet, Marie-Louise Leroux et Pierre-Carl Michaud, « Long-Term Care Insurance: Information Frictions and Selection », American Economic Journal: Economic Policy, 2020, à paraître.

Publié dans

American Economic Journal: Economic Policy, 2020, à paraître