Research Data from University of Liege Update Understanding of Public Economic Theory (Long-term care and intrafamily moral hazard: Optimal public policy)

2020 MAY 15 (NewsRx) -- By a News Reporter-Staff News Editor at Politics, Law & Government Daily -- Fresh data on Economics - Public Economic Theory are presented in a new report. According to news reporting originating in Liege, Belgium, by NewsRx editors, the research stated, “The paper studies optimal public long-term care (LTC) policy in the context of intrafamily moral hazard suggested by Pauly. The model considers a representative family consisting of an adult child and her elderly parent who might become dependent, in which case he places a special value on the LTC provided to him by his child.”

The news reporters obtained a quote from the research from the University of Liege, “Since the child’s caregiving is decreasing in the amount of insurance coverage, the parent prefers to underinsure, which is socially suboptimal. The child’s choice of caregiving is also inefficient since she does not internalize its positive effect on the parent. The paper tackles these inefficiencies and shows that intrafamily moral hazard is a sufficient justification for public intervention targeted at insurance.”

According to the news reporters, the research concluded: “If not necessarily for the introduction of mandatory public insurance, then at least for the taxation or subsidization of private insurance premiums.”

For more information on this research see: Long-term care and intrafamily moral hazard: Optimal public policy. Journal of Public Economic Theory, 2019;21(6):1037-1055. Journal of Public Economic Theory can be contacted at: Wiley, 111 River St, Hoboken 07030-5774, NJ, USA. (Wiley-Blackwell - http://www.wiley.com/; Journal of Public Economic Theory - http://onlinelibrary.wiley.com/journal/10.1111/(ISSN)1467-9779)

Our news correspondents report that additional information may be obtained by contacting J. Klimaviciute, University of Liege, Dept. of Economics, Liege, Belgium.

The direct object identifier (DOI) for that additional information is: https://doi.org/10.1111/jpet.12338. This DOI is a link to an online electronic document that is either free or for purchase, and can be your direct source for a journal article and its citation.

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