Publications [#294322] of Connel Fullenkamp

Journal Articles

1. Chami, R; Fullenkamp, C, The optimal subsidy to private transfers under moral hazard, IMF Staff Papers, vol. 49 no. 2 (December, 2002), pp. 242-251, ISSN 1020-7635
   (last updated on 2024/04/24)

   Abstract:
   Private income transfers are increasingly viewed as an alternative to government income transfers such as social insurance and foreign aid. This paper models the incentive effects of government-subsidized private transfers and finds that although there is a significant welfare benefit to subsidizing private transfers, there is also a significant welfare cost. It is shown analytically, as well as through simulations, that the optimal subsidy to private transfers falls when the market reaction is taken into consideration.