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dc.contributor.author
Gemmo, Irina
dc.contributor.author
Kubitza, Christian
dc.contributor.author
Rothschild, Casey
dc.date.accessioned
2020-08-11T08:46:02Z
dc.date.available
2020-08-11T03:01:36Z
dc.date.available
2020-08-11T08:42:00Z
dc.date.available
2020-08-11T08:46:02Z
dc.date.issued
2020-10-01
dc.identifier.issn
0047-2727
dc.identifier.issn
1879-2316
dc.identifier.other
10.1016/j.jpubeco.2020.104237
en_US
dc.identifier.uri
http://hdl.handle.net/20.500.11850/430959
dc.description.abstract
We prove the existence of the constrained efficient Miyazaki (1977)–Wilson (1977)–Spence (1978) equilibrium in competitive markets with adverse selection when the distribution of unobservable types is continuous. Our existence proof applies under extremely general assumptions about individual preferences. When we restrict preferences to have the widely-used-in-the-selection-markets-literature quasilinear form, we characterize the properties of this equilibrium by developing a simple and computationally efficient numerical method for constructing it. Applying this method, we show in a natural setting how one would compute the equilibrium allocation, potentially facilitating empirical work using the MWS equilibrium. We illustrate this empirical application in the context of policy interventions and show that the welfare implications of a coverage mandate critically hinge on whether the market implements a constrained efficient allocation like the MWS equilibrium or a constrained inefficient allocation like in Azevedo and Gottlieb (2017).
en_US
dc.language.iso
en
en_US
dc.publisher
Elsevier
en_US
dc.subject
Asymmetric and private information
en_US
dc.subject
Adverse selection
en_US
dc.subject
Insurance markets
en_US
dc.subject
Equilibrium existence
en_US
dc.title
Constrained efficient equilibria in selection markets with continuous types
en_US
dc.type
Journal Article
ethz.journal.title
Journal of Public Economics
ethz.journal.volume
190
en_US
ethz.pages.start
104237
en_US
ethz.size
11 p.
en_US
ethz.code.jel
JEL - JEL::D - Microeconomics::D8 - Information, Knowledge, and Uncertainty::D82 - Asymmetric and Private Information; Mechanism Design
en_US
ethz.code.jel
JEL - JEL::G - Financial Economics::G2 - Financial Institutions and Services::G22 - Insurance; Insurance Companies; Actuarial Studies
en_US
ethz.code.jel
JEL - JEL::D - Microeconomics::D4 - Market Structure, Pricing, and Design::D41 - Perfect Competition
en_US
ethz.identifier.wos
ethz.identifier.scopus
ethz.publication.place
Amsterdam
en_US
ethz.publication.status
published
en_US
ethz.leitzahl
ETH Zürich::00002 - ETH Zürich::00012 - Lehre und Forschung::00007 - Departemente::02120 - Dep. Management, Technologie und Ökon. / Dep. of Management, Technology, and Ec.::03877 - Bommier, Antoine / Bommier, Antoine
ethz.leitzahl.certified
ETH Zürich::00002 - ETH Zürich::00012 - Lehre und Forschung::00007 - Departemente::02120 - Dep. Management, Technologie und Ökon. / Dep. of Management, Technology, and Ec.::03877 - Bommier, Antoine / Bommier, Antoine
ethz.date.deposited
2020-08-11T03:01:40Z
ethz.source
SCOPUS
ethz.eth
yes
en_US
ethz.availability
Metadata only
en_US
ethz.rosetta.installDate
2020-08-11T08:42:23Z
ethz.rosetta.lastUpdated
2021-02-15T16:07:45Z
ethz.rosetta.versionExported
true
ethz.COinS
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