Can risk-based premiums be more equitable than social insurance?
نویسندگان
چکیده
We examine the proposal by Peter Zweifel and Michael Breuer to combine risk-based premiums with a subsidy for individuals whose expenditure for health insurance exceeds a certain share of income. Assuming a maximin social welfare function and optimal linear income taxation, we find that this proposal is superior to social insurance if the correlation between productivity and health is not too large. However, a considerable part of advantage of the ZB proposal can be explained by the introduction of non-linear taxation which can also be combined with social insurance. JEL-classification: H24, H42, H51.
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