Department of Economics
University of California, San Diego
9500 Gilman Drive, #0508
La Jolla, CA 92093
NBER Program Affiliations:
NBER Affiliation: Faculty Research Fellow
NBER Working Papers and Publications
|July 2017||Paternalism and Pseudo-Rationality|
with David Laibson: w23620
Resource allocations are jointly determined by the actions of social planners and households. In this paper we highlight the distinction between planner optimization and household optimization. We show that planner optimization is a substitute for household optimization and that this is true even when there are information asymmetries, so that households know more about their preferences than planners. Our analysis illustrates the scope for mis-attribution in economic analysis. Are seemingly optimal allocations caused by optimizing households, or are such allocations caused by planners who paternalistically influence myopic and passive households? We show that widely studied allocative optimality conditions that are implied by household optimization also arise in an economy with a rational...
|July 2016||Household Labor Supply Responses to Severe Health Shocks and the Gains from Social Insurance|
with Torben Heien Nielsen
in Social Insurance Programs (Trans-Atlantic Public Economic Seminar - TAPES), Roger Gordon, Andreas Peichl and James Poterba, organizers
|October 2015||Do Employer Pension Contributions Reflect Employee Preferences? Evidence from a Retirement Savings Reform in Denmark|
with Jessica A. Laird, Torben Heien Nielsen: w21665
This paper studies how firms set contributions to employer-provided 401(k)-type pension plans. Using a reform that decreased the subsidy for contributions to capital pension accounts for Danish workers in the top income tax bracket, we provide strong evidence that employers' contributions are based on their employees' savings preferences. We find an immediate decrease in employer contributions to capital accounts, whose magnitude increased in the share of employees directly affected by the reform. This response was large relative to average employee responses within private IRA-type plans and was accompanied by a similar-magnitude shift of employer contributions to annuity accounts.
Published: Itzik Fadlon & Jessica Laird & Torben Heien Nielsen, 2016. "Do Employer Pension Contributions Reflect Employee Preferences? Evidence from a Retirement Savings Reform in Denmark," American Economic Journal: Applied Economics, vol 8(3), pages 196-216. citation courtesy of
|July 2015||Family Labor Supply Responses to Severe Health Shocks|
with Torben Heien Nielsen: w21352
This paper provides new evidence on how household labor supply responds to fatal and severe non-fatal health shocks in the short- and medium-run. To identify the causal effects of these shock realizations, we leverage administrative data on families' health and labor market outcomes, and construct counterfactuals to affected households by using households that experience the same shock but a few years in the future. We find that fatal health shocks lead to an immediate increase in the surviving spouses' labor supply and that this effect is entirely driven by families who experience significant income losses. Accordingly, widows, who face large income losses when their husbands die, increase their labor force participation by more than 11%; while widowers, who are significantly more financi...