Precautionary Saving and Social Insurance

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Life insurance, precautionary saving and contingent bequest

We present a model of life-insurance purchase that takes into account the age of the beneficiary. The beneficiaries considered herein are young children with no resources whose consumption needs are protected by purchasing life insurance if the breadwinner dies. We show that income transfer grows as the child ages; however, the size of contingent bequest shrinks because the need for protection ...

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Article history: Received 4 March 2010 Revised 5 September 2012 Available online 11 September 2012 JEL classification: E21 I38 D52

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ژورنال

عنوان ژورنال: Journal of Political Economy

سال: 1995

ISSN: 0022-3808,1537-534X

DOI: 10.1086/261987