Mortality Contingent Claims, Health Care, and Social Insurance
University of Chicago; National Bureau of Economic Research (NBER)
Gary S. Becker
University of Chicago - Department of Economics; University of Chicago - Booth School of Business
NBER Working Paper No. w5760
This paper analyzes the savings and health care impacts of mortality contingent claims, defined here as income measures, such as annuities and life-insurance, under which earned income is contingent on the length of one's life. The postwar increase in mandatory annuity and life-insurance programs, as well as the rapid increase in life-expectancy, motivates a better understanding of the effects that mortality contingent claims have on resources devoted to life-extension. We analyze the incentives that such claims imply for life-extension when resources may affect mortality endogenously and argue that these incentives dramatically alter the standard conclusions obtained when mortality is treated exogenously.
Number of Pages in PDF File: 29
Date posted: January 14, 1997