Hostname: page-component-cd9895bd7-fscjk Total loading time: 0 Render date: 2024-12-27T06:26:31.724Z Has data issue: false hasContentIssue false

Dependency Status and Demand for Social Insurance: Evidence from Experiments and Surveys*

Published online by Cambridge University Press:  06 November 2015

Abstract

Current thinking on the origins and size of the welfare state often ignores household relations in which people may depend on others for income or have dependents themselves. The influence of “dependency status” on individuals’ political preferences is unknown. We report results from a laboratory experiment designed to estimate the effect of dependency on preferences for policies that insure against labor market risk. Results indicate that (1) willingness to vote in favor of a social insurance policy is highly responsive to unemployment risk, (2) symmetric, mutual dependence is unrelated to support for insurance, but (3) asymmetric dependence (being dependent on someone else) increases support for social insurance. We connect our lab results to observational survey data and find similar relationships.

Type
Original Articles
Copyright
© The European Political Science Association 2015 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Abdellaoui, Mohammed, I’Haridon, Olivier, and Paraschiv, Corina. 2013. ‘Individual vs. Couple Behavior: An Experimental Investigation of Risk Preferences’. Theory and Decision 75(2):175191.Google Scholar
Agranov, Marina, and Palfrey, Thomas R.. 2014. ‘Equilibrium Tax Rates and Income Redistribution: A Laboratory Study’. Working Paper No. 19918, National Bureau of Economic Research.CrossRefGoogle Scholar
Almås, Ingvild, Cappelen, Alexander W., Sorensen, Erik, and Tungodden, Bertil. 2010. ‘Fairness and the Development of Inequality Acceptance’. Science 328(5982):11761178.Google Scholar
Anderson, Dan R., and Nevin, John R.. 1975. ‘Determinants of Young Marrieds’ Life Insurance Purchasing Behavior: An Empirical Investigation’. The Journal of Risk and Insurance 42(3):375387.Google Scholar
Ashraf, Nava. 2009. ‘Spousal Control and Intra-Household Decision Making: An Experimental Study in the Philippines’. The American Economic Review 99(4):12451277.CrossRefGoogle Scholar
Bagozzi, Richard P. 2012. ‘Alternative Approaches for Thinking About and Modeling Consumer Decisions in Relationships’. Journal of Consumer Psychology 22(3):315319.Google Scholar
Barber, Benjamin, Beramendi, Pablo, and Wibbels, Erik. 2013. ‘The Behavioral Foundations of Social Politics: Evidence from Surveys and a Laboratory Experiment’. Comparative Political Studies 46(10):11551189.Google Scholar
Bateman, Ian, and Munro, Alistair. 2005. ‘An Experiment on Risky Choice Amongst Households’. The Economic Journal 115(502):C176C189.Google Scholar
Bateman, Ian, and Munro, Alistair. 2013. ‘Testing Economic Models of the Household: An Experiment’. Technical report, CSERGE Working Paper EDM, No. 04-01.Google Scholar
Bellante, Don, and Green, Carole A.. 2004. ‘Relative Risk Aversion Among the Elderly’. Review of Financial Economics 13:269281.Google Scholar
Belot, Michele, Duch, Raymond, and Miller, Luis. 2015. ‘A Comprehensive Comparison of Students and Non-Students in Classic Experimental Games’. Journal of Economic Behavior & Organization 113:2633.Google Scholar
Bertocchi, Graziella, Brunetti, Marianna, and Torricelli, Costanza. 2010. ‘Marriage and Other Risky Assets: A Portfolio Approach’. CEPR Discussion Papers No. DP7162.Google Scholar
Bogach, Olga, Lefgren, Lars, and Sims, David. 2014. ‘Did You Build That? Effort, Luck, and Voting for Redistribution’. Unpublished working paper, Brigham Young University.Google Scholar
Bolton, Gary E., and Ockenfels, Axel. 2000. ‘Erc: A Theory of Equity, Reciprocity, and Competition’. The American Economic Review 90(1):166193.Google Scholar
Bone, John, Hey, John, and Suckling, John. 1999. ‘Are Groups More or Less Consistent than Individuals?’. Journal of Risk and Uncertainty 8:6381.Google Scholar
Braaten, R. Haugli, and Martinsson, Peter. 2015. ‘Experimental Measures of Household Decision Power’. Technical Report 02/2015 CREE.Google Scholar
Burden, Barry C. 2008. ‘The Social Roots of the Partisan Gender Gap’. Public Opinion Quarterly 72(1):5575.Google Scholar
Cabrales, Antonio, Nagel, Rosemarie, and RodrguezMora, Jos V.. 2012. ‘It is Hobbes, Not Rousseau: An Experiment on Voting and Redistribution’. Experimental Economics 15(2):278308.Google Scholar
Carlsson, Fredrik, Martinsson, Peter, Qin, Ping, and Sutter, Matthias. 2013. ‘The Influence of Spouses on Household Decision Making Under Risk: An Experiment in Rural China’. Experimental Economics 16(3):383401.Google Scholar
Charness, Gary, and Rabin, Matthew. 2002. ‘Understanding Social Preferences with Simple Tests’. The Quarterly Journal of Economics 117(3):817869.Google Scholar
Chen, Yan, and Li, Sherry X.. 2009. ‘Group Identity and Social Preferences’. The American Economic Review 99(1):431457.Google Scholar
Clarke, Daniel, and Kalani, Gautam. 2011. Microinsurance decisions: evidence from Ethiopia. Mimeo, University of Oxford: Oxford, UK.Google Scholar
de Palma, Andre, Picard, Nathalie, and Ziegelmeyer, Anthony. 2011. ‘Individual and Couple Decision Behavior Under Risk: Evidence on the Dynamics of Power Balance’. Theory and Decision 70(1):4564.Google Scholar
Drewianka, Scott. 2008. ‘Household Production and Risk-Aversion’. Working paper, University of Wisconsin-Milwaukee.Google Scholar
Edlund, Lena, and Pande, Rohini. 2002. ‘Why Have Women Become Left-Wing? The Political Gender Gap and the Decline in Marriage’. The Quarterly Journal of Economics 117(3):917961.Google Scholar
Esarey, Justin, Salmon, Timothy C., and Barrilleaux, Charles. 2011a. ‘Social Insurance and Income Redistribution in a Laboratory Experiment’. Political Research Quarterly 65(3):685698.Google Scholar
Esarey, Justin, Salmon, Timothy C., and Barrilleaux, Charles. 2011b. ‘What Motivates Political Preferences? Self-Interest, Ideology, and Fairness in a Laboratory Democracy’. Economic Inquiry 50(3):604624.Google Scholar
Falk, Armin, and Fischbacher, Urs. 2006. ‘A Theory of Reciprocity’. Games and Economic Behavior 54(2):293315.Google Scholar
Fehr, Ernst, and Schmidt, Klaus M.. 1999. ‘A Theory of Fairness, Competition, and Cooperation’. The Quarterly Journal of Economics 114(3):817868.CrossRefGoogle Scholar
Ferber, Robert, and Lee, Lucy C.. 1980. ‘Acquisition and Accumulation of Life Insurance in Early Married Life’. The Journal of Risk and Insurance 47(4):713734.CrossRefGoogle Scholar
Finseraas, Henning, Jakobsson, Niklas, and Kotsadam, Andreas. 2012. ‘The Gender Gap in Political Preferences: An Empirical Test of a Political Economy Explanation’. Social Politics: International Studies in Gender, State & Society 19(2):219242.Google Scholar
Fischbacher, Urs. 2007. ‘Z-Tree: Zurich Toolbox for Ready-Made Economic Experiments’. Experimental Economics 10(2):171178.Google Scholar
Fortin, Bernard, and Lacroix, Guy. 1997. ‘A Test of the Unitary and Collective Models of Houselhold Labour Supply’. The Economic Journal 107(443):933955.Google Scholar
Gill, David, and Prowse, Victoria. 2011. ‘A Novel Computerized Real Effort Task Based on Sliders’. IZA Discussion Papers No. 5801, Institute for the Study of Labor (IZA).Google Scholar
Gill, David, and Prowse, Victoria. 2012. ‘A Structural Analysis of Disappointment Aversion in a Real Effort Competition’. American Economic Review 102(1):469503.CrossRefGoogle Scholar
Goldsmith, Art. 1983. ‘Household Life Cycle Protection: Human Capital Versus Life Insurance’. The Journal of Risk and Insurance 50(3):473486.Google Scholar
Gorlin, Margarita, and Dhar, Ravi. 2012. ‘Bridging the Gap Between Joint and Individual Decisions: Deconstructing Preferences in Relationships’. Journal of Consumer Psychology 22(3):320323.Google Scholar
Gray, Jeffrey S. 1998. ‘Divorce-Law Changes, Household Bargaining, and Married Women’s Labor Supply’. The American Economic Review 88(3):628642.Google Scholar
Greiner, Ben. 2015. ‘Subject Pool Recruitment Procedures: Organizing Experiments with ORSEE’. Journal of the Economic Science Association 1:114125.Google Scholar
Hall, Peter, and Soskice., David (eds). 2001. Varieties of Capitalism. Oxford: Oxford University Press.Google Scholar
Hamilton, Rebecca W., and Biehal, Gabriel J.. 2005. ‘Achieving Your Goals or Protecting Their Future? The Effects of Self? View on Goals and Choices’. Journal of Consumer Research 32(2):277283.Google Scholar
Higgins, Tory. 1998. ‘Promotion and Prevention: Regulatory Focus as a Motivational Principle’. In Mark P. Zanna (ed.), Advances in Experimental Social Psychology. 146. Princeton, NJ: Academic Press.Google Scholar
Hopper, JoAnne S. 1995. ‘Family Financial Decision Making: Implications for Marketing Strategy’. Journal of Services Marketing 9(1):2432.Google Scholar
Hotz, V. Joseph, Peet, Evan, and Thomas, Duncan. 2013. ‘Household Decision-Making: The Efficiency of Resource Allocations in Indonesian Households’. Technical report, Duke University.Google Scholar
Howard, Christopher. 2008. The Welfare State Nobody Knows: Debunking Myths About U.S. Social Policy. Princeton, NJ: Princeton University Press.Google Scholar
Iversen, Torben, and Soskice, David. 2001. ‘An Asset Theory of Social Policy Preferences’. American Political Science Review 95(4):875893.Google Scholar
Iversen, Torben, and Rosenbluth, Frances. 2006. ‘The Political Economy of Gender: Explaining Cross-National Variation in Household Bargaining, Divorce, and the Gender Voting Gap’. American Journal of Political Science 50(1):119.Google Scholar
Iversen, Torben, and Rosenbluth, Frances. 2010. Women, Work, and Politics. New Haven, CT: Yale University Press.Google Scholar
Klor, Esteban F., and Shayo, Moses. 2010. ‘Social Identity and Preferences Over Redistribution’. Journal of Public Economics 94(34):269278.CrossRefGoogle Scholar
Lee, Angela, Aaker, Jennifer, and Gardner, Wendi. 2000. ‘The Pleasures and Pains of Distinct Self-Construals: The Role of Interdependence in Regulatory Focus’. Journal of Personality and Social Psychology 78(6):11221134.Google Scholar
Lowery, David, de Jong, Marsha, van Eijk, Carola J., and Taal, Sandra. 2013. ‘Partisan Differences in Spending Preferences After the New Democrat and New Labour Transformations of Party Images’. Journal of Political Science and Public Affairs 1:1–8.Google Scholar
Lundberg, Shelly, and Pollak, Robert A.. 1996. ‘Bargaining and Distribution in Marriage’. The Journal of Economic Perspectives 10(4):139158.Google Scholar
Lundberg, Shelly J., Pollak, Robert A., and Wales, Terence J.. 1997. ‘Do Husbands and Wives Pool Their Resources? Evidence from the United Kingdom Child Benefit’. The Journal of Human Resources 32(3):463480.Google Scholar
Mandel, Naomi. 2003. ‘Shifting Selves and Decision Making: The Effects of Self-Construal Priming on Consumer Risk-Taking’. Journal of Consumer Research 30(1):3040.CrossRefGoogle Scholar
Margalit, Yotam. 2013. ‘Explaining Social Policy Preferences: Evidence from the Great Recession’. American Political Science Review 107(1):80103.Google Scholar
McCarty, Nolan, and Pontusson, Jonas. 2011. ‘The Political Economy of Inequality and Redistribution’. In Brian Nolan, Wiemer Salverda and Timothy M. Smeeding (eds), The Oxford Handbook of Economic Inequality. New York: Oxford University Press.Google Scholar
Meltzer, Allan, and Richard, Scott. 1981. ‘Rational Theory of the Size of Government’. Journal of Political Economy 101(49–83):914927.CrossRefGoogle Scholar
Moene, Karl O., and Wallerstein, Michael. 2001. ‘Inequality, Social Insurance, and Redistribution’. American Political Science Review 95(4):859874.Google Scholar
Moene, Karl O., and Wallerstein, Michael. 2003. ‘Earnings Inequality and Welfare Spending’. World Politics 55:485516.Google Scholar
Munro, Alistair, Bateman, Ian, and McNally, Tara. 2013. ‘The Family Under the Microscope: An Experiment Testing Economic Models of Household Choice’. Technical report, MPRA Working Paper No. 8974, MPRA.Google Scholar
Nickelsburg, Jerry, and Timmons, Jeffrey F.. 2012. ‘On the (Ir)relevance of Skill Specificity for Social Insurance’. Quarterly Journal of Political Science 7:3567.Google Scholar
Rabin, Matthew. 1993. ‘Incorporating Fairness into Game Theory and Economics’. The American Economic Review 83(5):12811302.Google Scholar
Rehm, Philip. 2009. ‘Risks and Redistribution: An Individual-Level Analysis’. Comparative Political Studies 42(7):855881.Google Scholar
Rehm, Philip. 2011. ‘Social Policy by Popular Demand’. World Politics 63(2):271299.Google Scholar
Rutstrom, Elizabeth E., and Williams, Melonie B.. 2000. ‘Entitlements and Fairness: An Experimental Study of Distributive Preferences’. Journal of Economic Behavior & Organization 43(1):7589.Google Scholar
Scheve, Kenneth, and Stasavage, David. 2006. ‘Religion and Preferences for Social Insurance’. Quarterly Journal of Political Science 1:255286.Google Scholar
Scheve, Kenneth, and Stasavage, David. 2008. ‘Religion and Social Insurance: Evidence from the United States, 1970–2002’. In Ian Shapiro, Peter Swenson and Daniela Donno (eds), Divide and Deal: The Politics of Distribution in Democracies. 149185. New York: New York University Press.Google Scholar
Simpson, Jeffry A., Griskevicius, Vladas, and Rothman, Alexander J.. 2012. ‘Consumer Decisions in Relationships’. Journal of Consumer Psychology 22(3):304314.Google Scholar
Sundn, Annika E., and Surette, Brian J.. 1998. ‘Gender Differences in the Allocation of Assets in Retirement Savings Plans’. American Economic Review, Papers & Proceedings 88:207211.Google Scholar
Zhou, Rongrong, and Pham, Michel T.. 2004. ‘Promotion and Prevention Across Mental Accounts: When Financial Products Dictate Consumers Investment Goals’. Journal of Consumer Research 31(1):125135.Google Scholar
Zietz, Emily Norman. 2003. ‘An Examination of the Demand for Life Insurance’. Risk Management and Insurance Review 6(2):159191.Google Scholar
Supplementary material: PDF

Ahlquist supplementary material

Online Appendix

Download Ahlquist supplementary material(PDF)
PDF 226.9 KB