WI20-02: Firm Investment, Labor Supply, and the Design of Social Insurance: Evidence from Accommodations for Workplace Disability

Long-term care represents a significant cost to older adults in the US, and nursing home use is an important part of long-term care. It is therefore important to understand how older adults make nursing home-related decisions. This study analyzes the determinants of older adults’ nursing home use expectations, their relationship with actual nursing home use in the future, and the association between nursing home use expectations and older adults’ decisions regarding wealth accumulation. The findings indicate that older adults update their nursing home use expectations rationally and their nursing home use expectations have strong predictive power for actual nursing home use in the future, but these expectations are not statistically significantly associated with wealth accumulation.