When adult children are financially responsible for their parents, they can take considerable
interest in the amount of their parents' long-term care (LTC) insurance. In this paper, we look
at the optimal levels of LTC insurance and of informal care, and at the link between these
two decisions when the child, who provides informal care, is also the decision-maker with
regard to LTC insurance. Interestingly, results differ depending on the degree of both
parental and child altruism and indicate either complementarity or substitutability between …