Ontology highlight
ABSTRACT:
SUBMITTER: Einav L
PROVIDER: S-EPMC3016055 | biostudies-literature | 2010 Aug
REPOSITORIES: biostudies-literature
Einav Liran L Finkelstein Amy A Cullen Mark R MR
The quarterly journal of economics 20100801 3
We provide a graphical illustration of how standard consumer and producer theory can be used to quantify the welfare loss associated with inefficient pricing in insurance markets with selection. We then show how this welfare loss can be estimated empirically using identifying variation in the price of insurance. Such variation, together with quantity data, allows us to estimate the demand for insurance. The same variation, together with cost data, allows us to estimate how insurer's costs vary a ...[more]