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Can transparency increase adverse selection? Evidence from an electronic platform for annuities

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  • Fajnzylber, Eduardo
  • Gabrielli, M. Florencia
  • Willington, Manuel

Abstract

We show that the introduction of an electronic platform in the Chilean annuity market with the objectives of bringing transparency and enhancing competition also exacerbated adverse selection. The longevity gap between male annuitants and non-annuitants increased around 24 months.

Suggested Citation

  • Fajnzylber, Eduardo & Gabrielli, M. Florencia & Willington, Manuel, 2023. "Can transparency increase adverse selection? Evidence from an electronic platform for annuities," Economics Letters, Elsevier, vol. 228(C).
    • Handle: RePEc:eee:ecolet:v:228:y:2023:i:c:s016517652300160x
    DOI: 10.1016/j.econlet.2023.111135
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    References listed on IDEAS

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    More about this item

    Keywords

    Adverse selection; Annuities; Market transparency; Chilean pension system;
    All these keywords.

    JEL classification:

    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
    • J32 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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