International Tax and Public Finance

, Volume 9, Issue 1, pp 33–50 | Cite as

The Role of Tax Subsidies in the Market for Health Insurance

  • Mark Stabile


This paper investigates the role of tax subsidies in linking the market for health insurance to the employment relationship. Using both American and Canadian data, it investigates how these subsidies influence whether health insurance coverage is offered in different sized firms and whether it is offered through an employer versus the individual private market. The findings indicate that tax subsidies encourage the provision of insurance in smaller firms. Removal of the subsidies would cause the level of insurance in small firms to decline significantly, but would not cause a large change in the level of insurance in larger firms. Part of this decline would be offset by increases in the market for individually purchased insurance.

tax subsidies health insurance 


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Copyright information

© Kluwer Academic Publishers 2002

Authors and Affiliations

  • Mark Stabile
    • 1
  1. 1.Department of EconomicsUniversity of TorontoTorontoCanada

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