Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/101012
Authors: 
Braun, R. Anton
Kopecky, Karen A.
Koreshkova, Tatyana
Year of Publication: 
2013
Series/Report no.: 
Working Paper, Federal Reserve Bank of Atlanta 2013-2
Abstract: 
Poor heath, large acute and long-term care medical expenses, and spousal death are significant drivers of impoverishment among retirees. We document these facts and build a rich, overlapping generations model that reproduces them. We use the model to assess the incentive and welfare effects of Social Security and means-tested social insurance programs such as Medicaid and food stamp programs, for the aged. We find that U.S. means-tested social insurance programs for retirees provide significant welfare benefits for all newborn. Moreover, when means-tested social insurance benefits are of the scale in the United States, all individuals would prefer to be born into an economy with no Social Security. Finally, we find that the benefits of increasing means-tested social insurance are small or negative, if we hold fixed Social Security contributions and benefits at their current levels.
Subjects: 
Social Security
Medicaid
social insurance
elderly
medical expenses
JEL: 
E62
H31
H52
H55
Document Type: 
Working Paper

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