Related Experiment Video
Updated: Feb 5, 2026
07:10
At-Risk Butterfly Captive Propagation Programs to Enhance Life History Knowledge and Effective Ex Situ Conservation Techniques
Published on: February 11, 2020
7.7K
Incidental Bequests and the Choice to Self-Insure Late-Life Risks
The American Economic Review
|September 8, 2018
Summary
Retirees often forgo annuities and long-term care insurance due to bequest motives. These motives increase savings and decrease insurance purchases, contradicting standard economic models.
Area of Science:
- Economics
- Retirement Planning
- Behavioral Economics
Background:
- Retirees face significant uncertainty regarding lifespan and healthcare expenses.
- Standard life-cycle models do not fully explain observed saving and insurance behaviors in retirement.
Purpose of the Study:
- To investigate why retirees often do not purchase annuities or long-term care insurance.
- To evaluate the role of bequest motives in retirement financial decisions.
Main Methods:
- Analysis of retiree saving and insurance choices.
- Comparison of observed behavior with predictions from life-cycle models and models incorporating bequest motives.
Main Results:
- Retiree choices are inconsistent with models focused solely on individual consumption.
- Retiree behavior aligns well with models where bequests are considered luxury goods.
- Bequest motives reduce the perceived value of insurance by increasing the opportunity cost of precautionary saving.
Conclusions:
- Bequest motives significantly influence retirement financial planning.
- The desire to leave inheritances increases overall savings.
- The desire to leave inheritances significantly decreases the purchase of annuities and long-term care insurance.
More Related Videos
Related Concept Videos
02:42Half-life of a Reaction
39.1K
The half-life of a reaction (t1/2) is the time required for one-half of a given amount of reactant to be consumed. In each succeeding half-life, half of the remaining concentration of the reactant is consumed. For example, during the decomposition of hydrogen peroxide, during the first half-life (from 0.00 hours to 6.00 hours), the concentration of H2O2 decreases from 1.000 M to 0.500 M. During the second half-life (from 6.00 hours to 12.00 hours), the concentration decreases from 0.500 M to...
39.1K
01:23Characteristics of Life
261.8K
Biology is a natural science that studies life and living organisms, including their structure, function, development, interactions, evolution, distribution, and taxonomy. The field's scope is extensive and divided into several specialized disciplines, such as anatomy, physiology, ethology, genetics, and many more. All living things share a few key traits, including cellular organization, heritable genetic material and the ability to adapt/evolve, metabolism to regulate energy needs, the...
261.8K
02:39The Angiosperm Life Cycle
72.6K
Plants have a life cycle split between two multicellular stages: a haploid stage—with cells containing one set of chromosomes—and a diploid stage—with cells containing two sets of chromosomes. The haploid stage is the gamete-producing gametophyte, and the diploid stage is the spore-producing sporophyte.
72.6K
01:20Mate Choice
11.8K
Mate choice—the decision about whom to mate with—is a type of natural selection, since animals must reproduce to pass down their genes. Mate choice is also called intersexual selection because the behavior occurs between the sexes.
11.8K
01:12Relative Risk
2.2K
Relative risk (RR) is a statistical measure commonly used in epidemiology to compare the likelihood of a particular event occurring between two groups. This metric is important for evaluating the relationship between exposure to a specific risk factor and the probability of a particular outcome. It plays a crucial role in medical research, public health studies, and risk assessment. Relative risk quantifies how much more (or less) likely an event is to occur in an exposed group compared to an...
2.2K
02:40The Tree of Life - Bacteria, Archaea, Eukaryotes
38.7K
The “tree of life” describes the evolution of life and the evolutionary relationships between organisms. The root of the tree is the common ancestor to all life on Earth. All other species radiate from this point, much like the branches of a tree. The numerous tips of these branches on the tree of life represent every living, or extant, species. Extinct species, which are species that no longer exist, can be found towards the center of the tree. Currently, these organisms, both...
38.7K