Working papers:
[1.] " Pathways in long-term care and its determinants: evidence from Dutch administrative data", with Rob Alessie, Max Groneck and Raun van Ooijen. 2023.
Abstract: We examine the determinants of transitions into and out of long-term care (LTC) arrangements (no LTC, home-based care, or institutional care), given the severity of the need for care. We document that the time spent with a low physical impairment in home-based care is shorter than with a low cognitive impairment; also, individuals with a low or high physical impairment are more likely to transition back to home-based care or no LTC. Next, we use a multi-state model to examine whether the availability of informal care, income, and assets affects transitions between different LTC arrangements. Our findings highlight that having a partner or children can be an important source for informal care, i.e., delaying the use of more specialized care and fostering the use of less specialized care. However, while having a healthy partner delays institutional care use of physically impaired home-based care users by 20pp., this, surprisingly, accelerates the use of institutional care of cognitively impaired home-based care users by 19pp.. Also, having more income, assets, or an own house implies using less specialized care. These insights help guide the ongoing shift to home-based care in many countries that face the challenges of an aging population and a declining availability of informal care.
Presented at: 2nd Health Economics Workshop (2022), Copenhagen (Denmark); EuHEA Conference (2022), Oslo (Norway); Netspar International Pension Workshop (2023)
[2.] "Combining Old-Age Insurances to Accommodate Selection Effects in the Market for Life Annuities and Long-term Care Insurance Inequalities in Long-Term Care and Mortality", with Rob Alessie, Max Groneck and Raun van Ooijen. 2025 (Submitted).
Abstract: Bundling insurance products to hedge multiple life risks can effectively mitigate problems arising from individual heterogeneity within single risks. We theoretically derive a closed-form solution for bundled insurance, emphasizing the key risk structure factors critical for minimizing selection problems. Our empirical analysis focuses on the heterogeneity of two significant end-of-life risks—long-term care (LTC) needs and longevity—and explores the feasibility of bundling LTC insurance with life annuities. Utilizing unique Dutch administrative data encompassing over three million individuals aged 65 and above, we estimate opposing patterns in LTC utilization and longevity across lifetime income. Applying our method shows that bundled insurance can help address selection incentives and require risk-rated premiums based on marital status and gender.
Presented at: EEA Congress (2020), Virtual; Workshop on Longevity Risk, Differential Mortality and Lifetime Inequality (2018), Brescia (Italy).
Media coverage: Invited to write press summary for EEA congress 2020.
[3.] "Health inequalities and the progressivity of old-age social insurance programs", mimeo, with Max Groneck and Raun van Ooijen. 2024.
Abstract: A well-established negative correlation exists between lifetime income and health and mortality risk. We quantify the welfare implications of living longer and using less LTC by higher incomes, implying higher lifetime retirement income and lower lifetime LTC cost. To this end, we model singles' and couples' consumption and saving behavior throughout the life cycle. Households face uncertain labor income at working age and uncertain and heterogeneous health and mortality across socioeconomic groups, so precautionary savings will differ across these groups. In addition, we assume that households value living and giving bequests to their heirs, implying a potential saving motive for bequests. We estimate the parameters of the model using unique administrative data from the Netherlands. Old-age insurance programs for retirement and LTC provision result in a substantial redistribution of welfare due to socioeconomic inequalities in LTC needs and mortality. The welfare effect amounts to 23.4% additional consumption after age 65 for the income-rich compared to those in the bottom lifetime income quartile. A large part of 22.2pp of the welfare gain for the richer households is explained by their strong preferences for leaving bequests: they have lower co-payments for LTC and more retirement income, which they spend on leaving a larger bequest upon death.
Presented at: European Workshop on Econometrics and Health Economics (2024, Upcoming), Rotterdam (the Netherlands); CEBI lunch seminar (2022), Copenhagen (Denmark); iHEA Congress (2021), Virtual; Annual Conference of the International Association for Applied Econometrics (2021), Virtual; North American Summer Meeting of the Econometric Society (2021), Virtual.
This is my master's thesis, which is awarded the Jan Brouwer Scriptieprijs 2021 by the Royal Holland Society for Sciences and Humanities (Koninklijke Hollandsche Maatschappij der Wetenschappen, KHMW). The KHMW posted their jury report on their webpage.
[4.] "Estimating left-truncated shared-frailty models with time-varying covariates", mimeo, with Gerard van den Berg. 2023.
Abstract: Shared frailty models with frailty terms that are independent of the observed covariates are the duration data equivalent of linear panel data models with random effects. We consider likelihood-based estimation of shared frailty models if observed durations are left-truncated, covariates can be time-varying, and a random effect is shared among an arbitrary amount of spells. Our estimation procedure accommodates dynamic selection on both observed and unobserved characteristics, which makes the observed left-truncated sample selective with respect to the underlying population. We deliver a general and novel STATA routine for our estimation procedure. We provide an example where the biases in duration dependence and covariate effects that arise if truncation is not properly taken care of are substantial at a low number of shared spells but eventually approach zero for a higher number of spells. At the same time, the frailty variance is increasingly overestimated.
Presented at: Groningen Metrics Meet (GMM) (2023)
[5.] "Financial Consequences of Widowhood", Netspar Design paper 160, with Rob Alessie and Raun van Ooijen. 2020.
Abstract: This paper studies the impact of widowhood on the income position of surviving spouses, before and after the normal retirement age. Moreover, we consider the importance of public survivor benefits and other sources of income that alleviate the financial consequences of widowhood. To further understand the degree of income protection provided by public survivor benefits, we analyze the impact of a substantial reform of the survivors' benefits scheme in 1996 that imposed stricter eligibility criteria and a means-tested benefit level for cohorts born after 1949. Using rich administrative data, we find that, three years after widowhood, women of working age experience an about twenty percent reduction in equivalized disposable household income. In contrast, retired widows can maintain their previous standard of living. The survivor's benefit reform resulted in a further reduction in the standard of living of working-age widows, particularly for women with a high pre-widowhood household income who work less after the reform. While men experienced a thirty percent increase in equivalized income before the reform, their standard of living remains fairly constant after the reform because their labor supply remains unchanged.
Presented at: EEA congress (2021).
Media coverage: Invited to write summary for the magazine Geron.
Work in progress:
[1.] "The Financial Consequences of Divorce. Implications for Retirement Planning", with Max Groneck, Raun van Ooijen, Rob Alessie, and Ugne Sliciute.
[2.] "Are preferences for aspects of well-being stable? Evidence from regional-based panels in a period of large societal change", with Jochen Mierau and Raun van Ooijen.