Overconfidence, Insurance, and Paternalism
نویسندگان
چکیده
منابع مشابه
Overconfidence, Insurance and Paternalism
It is well known that when agents are fully rational, compulsory public insurance may make all agents better o¤ in the Rothschild and Stiglitz (1976) model of insurance markets. We nd that when su¢ ciently many agents underestimate their personal risks, compulsory insurance makes low-risk agents worse o¤. Hence, behavioral biases may weaken some of the well-established rationales for governmen...
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As argued by Werner DeBondt and Richard H. Thaler (1995): “Perhaps the most robust finding in the psychology of judgment is that people are overconfident.” This paper surveys part of the vast empirical and experimental literature on overconfidence. We find broad evidence that many subjects underestimate their health and driving risk, and that this often results in underinvestment in precautions...
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This chapter concerns the normativity of the concepts of paternalism and libertarian paternalism. The first concept is central to evaluation of public health policy, but its meaning is controversial. The second concept is equally controversial and has received much attention recently. It may or may not shape the future evaluation of public health policy. In order to facilitate honest and fruitf...
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Citizens’ desires to assist the poor reflect a mixture of insurance motives, altruism, and paternalism. Consequently, government policies toward the poor have always been a mixture of income supports and regulations of recipient behavior. Unfortunately, there have been very few analyses of the how these distinct motives interact to generate various policies to the poor. In this paper, we develo...
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ژورنال
عنوان ژورنال: American Economic Review
سال: 2007
ISSN: 0002-8282
DOI: 10.1257/aer.97.5.1994