TY - JOUR T1 - Housing liquidity and long-term care insurance demand: A quantitative evaluation JF - Journal of Public Economics Y1 - 2021 A1 - Achou, Bertrand KW - Housing KW - Insurance KW - Life-cycle KW - Liquidity KW - Long-term Care KW - Retirement AB - In theory, illiquid housing may substitute for long-term care insurance (LTCI) as retirees decumulate housing wealth mainly when moving to long-term care facilities. In this paper, I build and estimate a rich life-cycle model of single retirees in order to evaluate whether the impact of housing liquidity on LTCI demand is large. Overall, I find that the prospects of increasing LTCI demand by making housing more liquid are quite limited, as even large increases in housing liquidity generate modest increases in LTCI demand. I also find a limited impact of housing liquidity on the demand for life annuities. Finally, I show that the types of bequest motives used to rationalize the low take-up of reverse mortgages are generally inconsistent with the low demand for LTCI, suggesting that other factors may play a role in this low take-up of reverse mortgages. VL - 194 SN - 0047-2727 ER -