Targeting with In-Kind Transfers: Evidence from Medicaid Home Care

65 Pages Posted: 29 Jan 2018 Last revised: 23 Apr 2023

See all articles by Ethan Lieber

Ethan Lieber

University of Notre Dame

Lee Lockwood

University of Virginia - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: January 2018

Abstract

Making a transfer in kind reduces its value to recipients but can improve targeting. We develop an approach to quantifying this tradeoff and apply it to home care. Using randomized experiments by Medicaid, we find that in-kind provision significantly reduces the value of the transfer to recipients while targeting a small fraction of the eligible population that is sicker and has fewer informal caregivers than the average eligible. Under a wide range of assumptions within a standard model, the targeting benefit exceeds the distortion cost. This highlights an important cost of recent reforms toward more flexible benefits.

Suggested Citation

Lieber, Ethan and Lockwood, Lee, Targeting with In-Kind Transfers: Evidence from Medicaid Home Care (January 2018). NBER Working Paper No. w24267, Available at SSRN: https://ssrn.com/abstract=3112078

Ethan Lieber (Contact Author)

University of Notre Dame ( email )

361 Mendoza College of Business
Notre Dame, IN 46556-5646
United States

Lee Lockwood

University of Virginia - Department of Economics ( email )

237 Monroe Hall
P.O. Box 400182
Charlottesville, VA 22904-418
United States

HOME PAGE: http://leemlockwood.com

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