Insurance contracts with imprecise probabilities and adverse selection
Jeleva, Meglena; Villeneuve, Bertrand (2004), Insurance contracts with imprecise probabilities and adverse selection, Economic theory, 23, 4, p. 777-794. http://dx.doi.org/10.1007/s00199-003-0396-x
TypeArticle accepté pour publication ou publié
Journal nameEconomic theory
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Abstract (EN)This article deals with optimal insurance contracts in the framework of imprecise probabilities and adverse selection. Agents differ not only in the objective risk they face but also in the perception of risk. In monopoly, a range of configurations that VNM preferences preclude appears: a pooling contract may be optimal, incomplete coverage may be offered to high risks, low risks may be better covered.
Subjects / KeywordsImprecise probabilities; Insurance markets; Adverse selection
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The consequences for a monopolistic insurance firm of evaluating risk better than customers : The adverse selection hypothesis reversed Villeneuve, Bertrand (2000) Article accepté pour publication ou publié