An evolutionary analysis of insurance markets with adverse selection

Autor:	Achim Wambach, Thomas Tröger, Ana B. Ania
Rok vydání:	2002
Předmět:	Microeconomics Economics and Econometrics Financial economics Insurance policy Adverse selection Economics Insurance market Forward market Rothschild Competitor analysis Competitive equilibrium Outcome (game theory) Finance
Zdroj:	Games and Economic Behavior. 40:153-184
ISSN:	0899-8256
DOI:	10.1016/s0899-8256(02)00002-7
Popis:	The equilibrium nonexistence problem in Rothschild and Stiglitz's insurance market is reexamined in a dynamic setting. Insurance firms are boundedly rational and offer menus of insurance contracts which are periodically revised: profitable competitors' contracts are imitated and loss-making contracts are withdrawn. Occasionally, a firm experiments by withdrawing or innovating a random set of contracts. We show that Rothschild and Stiglitz's candidate competitive equilibrium contracts constitute the unique long-run market outcome if innovation experiments are restricted to contracts which are sufficiently “similar” to those currently on the market.
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_________::6ce98c25483bd8500304fb4322aad7e0 https://doi.org/10.1016/s0899-8256(02)00002-7 Zobrazit plný text záznamu Full Text from ScienceDirect