Selection in Insurance Markets: Theory and Empirics in Pictures / Liran Einav, Amy Finkelstein.

Format:

Book

Author/Creator:

Einav, Liran.

Contributor:

National Bureau of Economic Research.

Finkelstein, Amy.

Series:

Working Paper Series (National Bureau of Economic Research) no. w16723.

NBER working paper series no. w16723

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Selection in Insurance Markets

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2011.

Summary:

We present a graphical framework for analyzing both theoretical and empirical work on selection in insurance markets. We begin by using this framework to review the "textbook" adverse selection environment and its implications for insurance allocation, social welfare, and public policy. We then discuss several important extensions to this classical treatment that are necessitated by important real world features of insurance markets and which can be easily incorporated in the basic framework. Finally, we use the same graphical approach to discuss the intuition behind recently developed empirical methods for testing for the existence of selection and examining its welfare consequences. We conclude by discussing some important issues that are not well-handled by this framework and which, perhaps not unrelatedly, have been little addressed by the existing empirical work.

Notes:

Print version record

January 2011.