12Social Insurance The New Function of Government（课件）- 《财政与金融》同步教学（人民大学·第五版）

12 12.1 What Is Insurance and Why Do Individuals Value It? 12.2 Why Have Social Insurance? Asymmetric Information and Adverse Selection 12.3 Other Reasons for Government Intervention in Insurance Markets 12.4 Social Insurance versus Self-Insurance: How Much Consumption Smoothing? 12.5 The Problem with Insurance: Moral Hazard 12.6 Putting It All Together: Optimal Social Insurance 12.7 Conclusion Social Insurance: The New Function of Government 1 of 38 1 12 Social Insurance: The New Function of Government Preamble to the United States Constitution: Establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity. For most of the country’s history, emphasis on “common defense.” Since 1950 or so, shift toward “the general welfare.” of 38 C H A P T E R 1 2 ■ S O C I A L I N S U R A N C E : T H E N E W F U N C T I O N O F G O V E R N M E N T 2 12 Government Spending by Function,1953 and 2014 1953 2014 Defense 69.4% 17.2% Disability and Unemployment 5.0 14.7 Social Security 3.6 24.3 Health 0.4 26.4 Other 21.6 17.5 Government today devotes a much larger portion of its budget to social insurance than it did 50 years ago. of 38 C H A P T E R 1 2 ■ S O C I A L I N S U R A N C E : T H E N E W F U N C T I O N O F G O V E R N M E N T 3 12 Social Insurance: The New Function of Government Government spending now focuses on social insurance programs. Social insurance programs: Government interventions in the provision of insurance against adverse events. For most programs, eligibility is not means-tested. Means-tested: Refers to programs in which eligibility depends on the level of one’s current income or assets. of 38 C H A P T E R 1 2 ■ S O C I A L I N S U R A N C E : T H E N E W F U N C T I O N O F G O V E R N M E N T 4 12.1 Insurance is a promise to make some payment in case of a particular event, in exchange for a pa