3 recent publications

Time to tidy up before leaving UQAM for Toulouse...

1. « Lobbying, family concerns and the lack of political support for estate taxation », Economics & Politics, 2015, forthcoming (with Pierre Pestieau)

Abstract
We provide an explanation for why estate taxation is surprisingly little used, given the skewness of the estate distribution. Taxing estates implies meddling with intra-family decisions, which is frown upon by many. At the same time, given the concentration of estates a small proportion of the population stands to gain a lot by decreasing estate taxation. We provide an analytical model, together with numerical simulations, where agents bequeathing large estates make monetary contributions in order to play up the salience of the encroachment aspects of estate taxation on family decisions and to decrease its political support.

Paper available here

2. « Private, social and self insurance for long-term care in the presence of family help », Journal of Public Economic Theory, 2015, forthcoming (with Pierre Pestieau)

Abstract
We study the political determination of the level of social long-term care insurance when voters can top up with private insurance, saving and family help. Agents differ in income, probability of becoming dependent and of receiving family help, and amount of family help received. Social insurance redistributes across income and risk levels, while private insurance is actuarially fair. The income-to-dependency probability ratio of agents determines whether they prefer social or private insurance. Family support crowds out the demand for both social and, especially, private insurance, as strong prospects of family help drive the demand for private insurance to zero. The availability of private insurance decreases the demand for social insurance but need not decrease its majority chosen level. A majority of voters would oppose banning private insurance.

Paper available here


3. « Life expectancy heterogeneity and the political support for collective annuities », The Scandinavian Journal of Economics, 2015, forthcoming (with Helmuth Cremer). 

Abstract
Individuals, differing in productivity and life expectancy, vote over the size and type of a collective annuity. Its type is represented by the fraction of the contributive (Bismarckian) component (based on the worker's past earnings) as opposed to the noncontributive (Beveridgean) part (based on average contribution). The equilibrium collective annuity is either a large mostly Bismarckian program, a smaller pure Beveridgean one (in accordance with empirical evidence), or nil. A larger correlation between longevity and productivity, or a larger average life expectancy, both make the equilibrium collective annuity program more Beveridgean, although at the expense of its size.

Paper available here.