NBER Working Papers by Andrew Dick

Families who heed the 'experts'' advice and save for their children's college education typically receive less financial aid. The variation in the net price of college functions as a large tax on savings. College financial aid also functions as an income tax. This paper estimates the size and determinants of these income and asset taxes. We find that the marginal income tax typically ranges from 2% to 16% and the marginal asset levy from somewhat under 10% to as high as 25%. If a typical family chooses to accumulate $100,000 in assets rather than consuming these resources, it loses financial aid worth $10,000-$20,000.

This paper describes the likelihood and duration of nursing home admissions experienced by Americans after age 65. Our analysis generates predictions for a representative population, not for one selected to be at high risk of institutionalization, and should therefore be of direct relevance to the design of long-term care policies.