Sutton (1998) has recently proposed a theoretical lower bound to firm size inequality when a market is made of several independent submarkets. His results are valid asymptotically, as the number of submarkets becomes arbitrarily large. We show that, in small samples, his results can be interpreted as a positive relationship between an index of firm size inequality and the number of submarkets. ...

This paper is concerned with the analysis of zero-inflated count data when time of exposure varies. It proposes a new zero-inflated count data model that is based on two homogeneous Poisson processes and accounts for exposure time in a theory consistent way. The new model is used in an application to the effect of insurance generosity on the number of absent days. JEL Classification: J29, C25

Affective decision-making (ADM) is a refutable and predictive theory of individual choice under risk and uncertainty. It generalizes expected utility theory by positing the existence of two cognitive processes – the “rational” and the “emotional” process. Observed choice is the result of their simultaneous interaction. We present a model of affective choice in insurance markets, where risk perc...

In automobile insurance, it is useful to achieve a priori ratemaking by resorting to generalized linear models, and here the Poisson regression model constitutes the most widely accepted basis. However, insurance companies distinguish between claims with or without bodily injuries, or claims with full or partial liability of the insured driver. This paper examines an a priori ratemaking procedu...

JEL Classification Code(s): J 31, J 71) "Perceptions of Discrimination, Effort to Obtain Psychological Balance, and Relative Wages: Can We Infer a Happiness Gradient?" There is a substantial literature that finds a linkage between happiness and relative economic well being as measured by earnings or wages. There is also a well documented racial gap in wages. One explanation for this is disparat...

An important issue with promoting formal insurance in the rural areas of developing countries that has been previously ignored is the interaction between formal insurance and preexisting informal risk sharing arrangements. This paper shows in theory that formal insurance will crowd out informal transfers even when individuals do not purchase insurance, which often makes the overall welfare impa...

We introduce both idiosyncratic and aggregate shocks in an endogenous growth model with endogenous partial insurance to the idiosyncratic shock. Aggregate uncertainty introduces an additional channel that can play an important role in determining the effects of private information on expected growth and asset prices. We show the impact of aggregate and idiosyncratic shocks on expected growth an...

We show that the complete list of regular excluded minors for the class of signed-graphic matroids is M(G1), . . . ,M(G29), R15, R16. Here G1, . . . , G29 are the vertically 2-connected excluded minors for the class of projective-planar graphs.

Social Insurance with Competitive Insurance Markets and Risk Misperception* This paper considers an economy where individuals differ in productivity and in risk. Rochet (1991) has shown that when private insurance markets offer full coverage at fair rates, social insurance is desirable if and only if risk and productivity are negatively correlated. This condition is usually shown to be satisfie...

Article history: Received 5 September 2012 Received in revised form 13 July 2013 Accepted 15 July 2013 Available online 24 July 2013 This paper provides micro-level evidence on the relationship between labor market conditions and social insurance participation among Chinese industrial firms. I find that the increased scarcity of labor over this period was a quantitatively important driver of pa...