The European Journal of Health Economics

, Volume 17, Issue 5, pp 611–628 | Cite as

Redistribution through social health insurance: evidence on citizen preferences

  • Christian Pfarr
  • Andreas SchmidEmail author
Original Paper


The extent of social health insurance (SHI) and supplementary private insurance is frequently analyzed in public choice. Most of these analyses build on the model developed by Gouveia (1997), who defines the extent of SHI as consequence of a choice by self-interested voters. In this model, an indicator reflecting individuals’ relative income position and relative risk of falling ill determines the voting decision. Up to now, no empirical evidence for this key assumption has been available. We test the effect of this indicator on individuals’ preferences for the extent of SHI in a setting with mandatory SHI that can be supplemented by private insurance. The data is based on a DCE conducted in the field with a representative sample of 1538 German citizens in 2012. Conditional logit and latent class models are used to analyze preference heterogeneity. Our findings strongly support the assumptions of the models. Individuals likely to benefit from public coverage show a positive marginal willingness to pay (MWTP) for both a shift away from other beneficiary groups toward the sick and an expansion of publicly financed resources, and the expected net payers have a negative MWTP and prefer lower levels of public coverage.


Social health insurance Preferences Discrete choice experiment 

JEL Classification

H23 H51 I13 C93 



We thank three anonymous referees for very helpful comments and suggestions. The authors gratefully acknowledge financial support from the German Research Foundation (DFG). We are also grateful to Martina Wagner for her assistance in preparing the discrete choice experiment as well as the socioeconomic questionnaire. We would also like to thank Pedro Pita Barros, Albert Ma, Marlies Ahlert, Tor Iversen, Matthias Kifmann, Laura Birg and the conference participants at the 2014 Meeting of the iHEA/ECHE in Dublin, the 2013 Annual Meeting of the German Association of Health Economics (dggö) in Essen, the 2013 Meeting of the NHESG in Oslo as well as seminar participants at the CINCH summer school in Essen, the Brown-Bag seminar at the University of Bayreuth and the DIBOGS seminar in Düsseldorf for helpful comments and suggestions. All remaining errors are ours. The study was funded by the German Research Foundation (DFG): UL163/4-2.

Conflict of interest

No potential conflicts of interest exist.

Supplementary material

10198_2015_704_MOESM1_ESM.pdf (632 kb)
Supplementary material 1 (PDF 631 kb)


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Copyright information

© Springer-Verlag Berlin Heidelberg 2015

Authors and Affiliations

  1. 1.Department of Law and Economics, Institute of Public FinanceUniversity of BayreuthBayreuthGermany
  2. 2.Department of Law and Economics, Health ManagementUniversity of BayreuthBayreuthGermany

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