eprintid: 32781 rev_number: 18 eprint_status: archive userid: 1482 importid: 105 dir: disk0/00/03/27/81 datestamp: 2019-09-23 09:23:25 lastmod: 2021-10-27 13:37:28 status_changed: 2020-09-07 12:44:38 type: article succeeds: 25679 metadata_visibility: show creators_name: Canta, Chiara creators_name: Cremer, Helmuth creators_idrefppn: 241586607 creators_idrefppn: 058485376 creators_affiliation: Toulouse School of Economics title: Long term care policy with nonlinear strategic bequests ispublished: pub subjects: subjects_ECO abstract: We study the design of long-term care (LTC) policies when children differ in their cost of providing informal care. Parents do not observe this cost, but they can commit to a “bequest rule” specifying a transfer (gift or bequest) conditional on the level of informal care. Care provided by high-cost children is distorted downwards in order to reduce the rent of low-cost ones. Social LTC insurance is designed to maximize a weighted sum of parents’ and children’s utility. When the LTC benefit is uniform and children have no weight in social welfare, the risk of becoming dependent is fully insured. Otherwise the insurance coverage of parents is adjusted to enhance the utility of the caregivers. Parents are never fully insured against the risk of having a high-cost child. A general policy conditioning LTC benefits on transfers provides full insurance even against the risk of having high-cost children. Quite surprisingly the level of informal care induced by the optimal (uniform or nonuniform) policy always increases in the children’s welfare weight. date: 2019-10 date_type: published publisher: Elsevier id_number: 10.1016/j.euroecorev.2019.07.015. official_url: http://tse-fr.eu/pub/123544 faculty: tse divisions: tse doctoral_school: mpse language: en has_fulltext: TRUE doi: 10.1016/j.euroecorev.2019.07.015. view_date_year: 2019 full_text_status: public publication: European Economic Review volume: vol. 119 pagerange: 548-566 refereed: TRUE issn: 0014-2921 oai_identifier: oai:tse-fr.eu:123544 harvester_local_overwrite: volume harvester_local_overwrite: publish_to_hal harvester_local_overwrite: doctoral_school harvester_local_overwrite: faculty harvester_local_overwrite: pending harvester_local_overwrite: publisher harvester_local_overwrite: id_number harvester_local_overwrite: creators_affiliation harvester_local_overwrite: doi harvester_local_overwrite: creators_idrefppn oai_lastmod: 2020-08-17T14:03:12Z oai_set: tse site: ut1 publish_to_hal: FALSE citation: Canta, Chiara and Cremer, Helmuth (2019) Long term care policy with nonlinear strategic bequests. European Economic Review, vol. 119. pp. 548-566. document_url: https://publications.ut-capitole.fr/id/eprint/32781/1/pii/S0014292119301436