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Equilibrium in Competitive Insurance Markets with Ex Ante Adverse Slection and Ex Post Moral Hazard

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  • Jack, W.

Abstract

Existence of pure strategy equilibria is studied in insurance markets that exhibit both ex ante adverse selection of the Rothschild-Stiglitz-Wilson type, and ex post hidden information moral hazard. It is found that ex post moral hazard has two offsetting effects on the existence of equilibrium, and that in general it is difficult to say whether an equilibrium is more or less likely to exist.

Suggested Citation

  • Jack, W., 1998. "Equilibrium in Competitive Insurance Markets with Ex Ante Adverse Slection and Ex Post Moral Hazard," Papers 340, Australian National University - Department of Economics.
    • Handle: RePEc:fth:aunaec:340
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    References listed on IDEAS

    as
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    Cited by:

    1. Wang, Hong & Zhang, Licheng & Yip, Winnie & Hsiao, William, 2006. "Adverse selection in a voluntary Rural Mutual Health Care health insurance scheme in China," Social Science & Medicine, Elsevier, vol. 63(5), pages 1236-1245, September.
    2. Marco A. Castaneda & James Marton, 2013. "Employer-Provided Health Insurance and the Adverse Selection Problem," Public Finance Review, , vol. 41(1), pages 3-36, January.
    3. Richard Dusansky & Çağatay Koç, 2010. "Implications of the Interaction Between Insurance Choice and Medical Care Demand," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 77(1), pages 129-144, March.
    4. Richard Dusansky & Çağatay Koç, 2016. "Individual Welfare When Consumers Can Shop For Health Insurance," Economic Inquiry, Western Economic Association International, vol. 54(2), pages 1283-1290, April.
    5. Xinyan Shi & Lydia Gan, 2023. "Equilibrium in Competitive Insurance Markets with Medical Tourism," Studies in Microeconomics, , vol. 11(2), pages 246-269, August.

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    More about this item

    Keywords

    INSURANCE ; ADVERSE SELECTION ; MORAL HAZARD;
    All these keywords.

    JEL classification:

    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • I1 - Health, Education, and Welfare - - Health

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