Sin Taxes, Insurance and the Correction of Internalities

Konferenzbeitrag

We analyze individuals with heterogeneous time-inconsistent preferences that consume sin goods and make a savings decision. A government may tax the sin good and provide mandatory health insurance. Due to time-inconsistency, the individual sin good and savings choices in ict internalities. Due to the ex-ante moral hazard of health insurance, sin good consumption also causes an externality. If the individuals' utility is such that savings and sin good demand decisions are decou- pled, the government can achieve the first-best outcome using a uniform tax rate and uniform health insurance. Moreover, in the optimum, the tax rate internalizes only the externality and the government provides full insurance. When the savings and sin good consumption choices are interrelated, the government can still achieve the first-best outcome by additionally using Social Security to stipulate minimum savings requirements.

Objekt anzeigen

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: Beiträge zur Jahrestagung des Vereins für Socialpolitik 2019: 30 Jahre Mauerfall - Demokratie und Marktwirtschaft - Session: Health Economics II ; No. D04-V3

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Consumer Economics: Theory ; Intertemporal Household Choice; Life Cycle Models and Saving ; Taxation and Subsidies: Efficiency; Optimal Taxation ; Fiscal Policies and Behavior of Economic Agents: Household ; Health Behavior ; Health Insurance, Public and Private ; Health: Government Policy; Regulation; Public Health
• Thema: sin tax ; health insurance ; moral hazard ; hyperbolic discounting ; internality

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Kalamov, Zarko ; Runkel, Marco
• Ereignis: Veröffentlichung
• (wer): ZBW - Leibniz-Informationszentrum Wirtschaft
• (wo): Kiel, Hamburg
• (wann): 2019

Weitere Informationen

• Handle: http://hdl.handle.net/10419/203620