Equilibrium in competitive insurance markets with ex ante adverse selection and ex post moral hazard
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چکیده
منابع مشابه
Equilibrium in competitive insurance markets with ex ante adverse selection and ex post moral hazard
Existence of pure strategy equilibria is studied in health insurance markets that exhibit both ex ante adverse selection of the Rothschild–Stiglitz–Wilson type, and ex post hidden information moral hazard. It is found that ex post moral hazard has two offsetting effects on the existence of equilibrium, and that in general it is difficult to say whether an equilibrium is more or less likely to e...
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We reverse the standard sequence of a complete contracting model: first the agent takes an action, then she alone observes the stochastic outcome and sends a message to the principal. Presuming of the validity of the Revelation Principle, the optimal (direct) mechanism with audit requires a two-part tariff to be offered to the agent, which weakens the ex ante incentives for effort. We then esta...
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Estimates of willingness to pay in adversely selected markets tend to understate the ex-ante (or utilitarian) willingness to pay for insurance. This paper derives an ’ex-ante’ willingness to pay curve that measures welfare from behind the veil of ignorance. I provide a strategy to estimate this curve using market choices and costs, combined with a measure of risk aversion. In examples motivated...
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ژورنال
عنوان ژورنال: Journal of Public Economics
سال: 2002
ISSN: 0047-2727
DOI: 10.1016/s0047-2727(01)00128-1