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Insurance fraud and corruption in the United States

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  • Rajeev K. Goel

Abstract

Using cross-sectional data for US states, this article examines the determinants of insurance fraud, focusing especially on the nexus between convictions for corruption and for insurance fraud. Results show that corruption convictions tend to crowd out insurance fraud convictions -- i.e., increases in convictions for corruption result in lower fraud convictions. In other findings, more crime fighting and prosecutorial resources increase fraud convictions, while the effects of specific insurance regulations are statistically insignificant. These findings are generally robust to simultaneity between corruption and insurance fraud. Policy implications are discussed.

Suggested Citation

  • Rajeev K. Goel, 2014. "Insurance fraud and corruption in the United States," Applied Financial Economics, Taylor & Francis Journals, vol. 24(4), pages 241-246, February.
    • Handle: RePEc:taf:apfiec:v:24:y:2014:i:4:p:241-246
    DOI: 10.1080/09603107.2013.877570
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    References listed on IDEAS

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    1. Gary S. Becker, 1974. "Crime and Punishment: An Economic Approach," NBER Chapters, in: Essays in the Economics of Crime and Punishment, pages 1-54, National Bureau of Economic Research, Inc.
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    3. Edward L. Glaeser & Claudia Goldin, 2006. "Corruption and Reform: Lessons from America's Economic History," NBER Books, National Bureau of Economic Research, Inc, number glae06-1.
    4. Glaeser, Edward L. & Saks, Raven E., 2006. "Corruption in America," Journal of Public Economics, Elsevier, vol. 90(6-7), pages 1053-1072, August.
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    6. Treisman, Daniel, 2000. "The causes of corruption: a cross-national study," Journal of Public Economics, Elsevier, vol. 76(3), pages 399-457, June.
    7. Cummins, J David & Tennyson, Sharon, 1996. "Moral Hazard in Insurance Claiming: Evidence from Automobile Insurance," Journal of Risk and Uncertainty, Springer, vol. 12(1), pages 29-50, January.
    8. Rajeev Goel & Michael Nelson, 2011. "Measures of corruption and determinants of US corruption," Economics of Governance, Springer, vol. 12(2), pages 155-176, June.
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    Cited by:

    1. Rajeev K. Goel, 2021. "Are health care scams infectious? Empirical evidence on contagion in health care fraud," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 42(1), pages 198-208, January.
    2. Rajeev K. Goel & James W. Saunoris, 2017. "The nexus of white collar crimes: shadow economy, corruption and uninsured motorists," Applied Economics, Taylor & Francis Journals, vol. 49(31), pages 3032-3044, July.
    3. Renee Flasher & Melvin A. Lamboy-Ruiz, 2019. "Impact of Enforcement on Healthcare Billing Fraud: Evidence from the USA," Journal of Business Ethics, Springer, vol. 157(1), pages 217-229, June.
    4. Rajeev K. Goel, 2020. "Medical professionals and health care fraud: Do they aid or check abuse?," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 41(4), pages 520-528, June.
    5. Simona Laura Dragos & Codruta Mare & Cristian Mihai Dragos & Gabriela Mihaela Muresan & Alexandra-Anca Purcel, 2022. "Does voluntary health insurance improve health and longevity? Evidence from European OECD countries," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 23(8), pages 1397-1411, November.

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