Maxwell Kellogg, NBER Post-Doctoral Fellow. "Household Self-Insurance and the Value of Disability Insurance in the United States"

Department seminar. Maxwell Kellogg is a Postdoctoral Fellow in Retirement and Disability Research at the National Bureau of Economic Research, and will be joining the Economics Department at the University of Oslo as an Assistant Professor in the Fall of 2022. He will present the paper: "Household Self-Insurance and the Value of Disability Insurance in the United States".

A photograph of Maxwell Kellogg

Maxwell Kellogg

Abstract:

This paper uses a life cycle model to study the welfare implications of reforms to U.S. Disability Insurance (DI) while accounting for household self-insurance. In addition to crowding out the insurance value of DI, household self-insurance may drive negative selection into DI by reducing implicit application costs. Allowing for such interactions, I find that expansionary DI reforms do not necessarily improve welfare. However, an asset test reduces negative selection and improves the welfare effects of DI expansions. Household self-insurance crowds out the value of DI expansions, but abstracting away from insurance value can deliver erroneous policy recommendations.

Link to Maxwell Kellogg's website.

Published Mar. 1, 2022 2:09 PM - Last modified May 4, 2022 10:29 AM