Cutler, David M. 1996. “Re-Examining the Three-Legged Stool of Retirement Income Support.” Social Security: What Role for the Future?, edited by Peter Diamond, David Lindeman, and Howard Young, 125-149. Washington, D.C.: National Academy of Social Insurance, 125-149. Website
Cutler, David M. 1996. “Why Don't Markets Insure Long-Term Risk?”.Abstract

This paper examines the apparent failure of private markets to adequately insure long-term risks. I argue that the key to long-term insurance is the importance of intertemporal risk. Long-term risks are difficult to insure because much of the risk concerns variability in the average cost of services used, rather than cross-section heterogeneity in service use. When intertemporal risk is large, insurance will provide indemnity benefits rather than a service benefit, and this in turn will limit demand for insurance. Analysis of long-term care insurance supports this view. An insurer underwriting full long-term care insurance would have a standard deviation of average costs for its pool of policies of 13 percent. Full insurance is essentially non-existent, however. Rather, insurers offer an indemnity payment conditional on use. While I cannot directly test whether this indemnity payment limits demand, I show that other common theories of market failure cannot explain all of the low rate of insurance purchase.

Cutler, David M. 1995. “Cutting Costs and Improving Health: Making Reform Work.” Health Affairs 14 (1): 161-172. Website
Cutler, David M. 1995. “The Incidence of Adverse Medical Outcomes under Prospective Payment.” Econometrica 63 (1): 29-50. Website
Cutler, David M. 1995. “Public Finance Issues in Health Reform.” National Tax Journal - 1994 Proceedings, 1-7. Website
Cutler, David. 1994. “A Guide to Health Care Reform.” Journal of Economic Perspectives 8 (3): 3-17. Publisher's Version
Cutler, David. 1994. “Financing, Estimation, and Economic Effects.” Health Affairs 13 (1): 30-49 . Publisher's Version
Cutler, David. 1994. “Studies in the Economics of Aging.” Studies in the Economics of Aging, edited by David Wise, 395-434. Chicago: University of Chicago Press, 395-434. Publisher's Version
Cutler, David. 1993. “Sectoral Shifts and Cyclical Unemployment Reconsidered.” Quarterly Journal of Economics 108 (1): 219-243 . Publisher's Version
Cutler, David. 1993. “Demographic Characteristics and the Public Bundle.” Public Finance, 178-198. Publisher's Version
Cutler, David. 1992. “Rising Inequality? Changes in the Distribution of Income and Consumption in the 1980s.” American Economic Review 82 (2): 546-551. Publisher's Version
Cutler, David. 1991. “Speculative Dynamics.” Review of Economic Studies 58: 529-546 . Publisher's Version
Cutler, David. 1991. “Macroeconomic Performance and the Disadvantaged.” Brookings Papers on Economic Activity 1 (2): 1-74 . Publisher's Version
Cutler, David. 1990. “Speculative Dynamics and the Role of Feedback Traders.” American Economic Review 80 (2): 63-68 . Publisher's Version
Cutler, David M, James M Porterba, Louise Sheiner, and Lawrence H Summers. 1990. “An Aging Society: Opportunity or Challenge?.” Brookings Papers on Economic Activity 1: 1-56 . Website
Cutler, David. 1989. “What Moves Stock Prices?.” Journal of Portfolio Management 15 (3): 4-12. Publisher's Version
Cutler, David. 1988. “The Costs of Conflict Resolution and Financial Distress: Evidence from the Texaco-Pennzoil Litigation.” Rand Journal of Economics 19 (2): 157-172 . Publisher's Version
Cutler, David. 1988. “Tax Reform and the Stock Market: An Asset Price Approach.” American Economic Review 78 (5): 1107-1117. Publisher's Version