1 / 5

Equilibrium in the insurance market with adverse selection and fraud

Equilibrium in the insurance market with adverse selection and fraud. Authors S. Hun Seog and Chang Mo Kang Discussant Larry Y .Tzeng. Contributions of the Paper (1/2).

sibyl
Download Presentation

Equilibrium in the insurance market with adverse selection and fraud

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Equilibrium in the insurance market with adverse selection and fraud • Authors • S. Hun Seog and Chang Mo Kang • Discussant • Larry Y .Tzeng

  2. Contributions of the Paper (1/2) • (1) Consider a two-dimension adverse selection problem (risk type and honest type) based on Picard (1996) and Rothschild and Stiglitz (1976). • (2)Pooling in honest type and separating in risk type. • (3) The commitment can improve the social welfare.

  3. Contributions of the Paper (2/2) • The insurance market may fail because high risk type policyholders are audited more frequently than low risk type policyholders, and leave the insurance market.

  4. Suggestions • (1) I would suggest that the authors also analyze the problem under Wilson (1977) conjecture. • (2) I would suggest that the authors elaborate more on whether the fine is paid to the insurer.

  5. Suggestions • (3) I would suggest that the authors discuss the possible results if the risk type and honest type are correlated.

More Related