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- Title
Tax incentives and the decision to purchase health insurance: Evidence from the self-employed.
- Authors
Gruber, Jonathan; Poterba, James
- Abstract
The Tax Reform Act of 1986 introduced a new tax subsidy for health insurance purchases by the self-employed. We analyze the changing patterns of insurance demand before and after tax reform to generate new estimates of how the after-tax price of insurance affects the discrete choice of whether to buy insurance. We employ both traditional regression models and difference-in-difference methods that compare changes in insurance coverage across groups around TRA86. The results from our most carefully controlled comparison suggest that a 1 percent increase in the cost of insurance coverage reduces the probability that a self-employed single person will be insured by 18 percentage points.
- Subjects
UNITED States; MEDICINE; TAXATION of health insurance; TAX exemption; TAX incentives; HEALTH insurance; FREELANCERS; BUSINESSMEN; TAX reform
- Publication
Quarterly Journal of Economics, 1994, Vol 109, Issue 3, p701
- ISSN
0033-5533
- Publication type
Article
- DOI
10.2307/2118419