Health insurance, portfolio choice, and retirement incentives
File(s)
Published version
Author(s)
Barucci, Emilio
Biffis, Enrico
Marazzina, Daniele
Type
Journal Article
Abstract
We study optimal portfolio choice and labor market participation in a continuous time setting in which agents face health shocks, medical expenses, and random lifetimes. We explore the implications of different forms of health coverage and study their impact on dynamic portfolios and labor supply decisions. We characterize these effects in semi-closed form, providing tools to measure retirement incentives as a function of relevant state variables and health cover arrangements. A calibration of the model matches empirically observed labor market participation patterns and portfolio decisions of US workers during the last phase of their working lives, while offering insights into the interlinkage between labor market participation, health insurance provision and portfolio choice.
Date Issued
2023-06-01
Date Acceptance
2022-09-01
Citation
European Journal of Operational Research, 2023, 307 (2), pp.910-921
ISSN
0377-2217
Publisher
Elsevier BV
Start Page
910
End Page
921
Journal / Book Title
European Journal of Operational Research
Volume
307
Issue
2
Copyright Statement
© 2022 The Authors. Published by Elsevier B.V.
This is an open access article under the CC BY license (http://creativecommons.org/licenses/by/4.0/)
This is an open access article under the CC BY license (http://creativecommons.org/licenses/by/4.0/)
License URL
Publication Status
Published
Date Publish Online
2022-09-22