Optimal insurance design of ambiguous risks
WebChristian Gollier, “Optimal insurance design of ambiguous risks”, TSE Working Paper, n. 12-303, May 2012, revised January 2013. WebWe examine the characteristics of the optimal insurance contract under linear transaction cost and an ambiguous distribution of losses. Under the standard expected utility model, …
Optimal insurance design of ambiguous risks
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WebDec 1, 2024 · This paper provides the results of an experiment on the willingness to pool genetic risk in health insurance. Subjects’ overall health risk has an assigned, … WebOct 9, 2014 · We also show that the policyholder’s ambiguity aversion may have the counterintuitive effect to reduce the optimal insurance coverage of an ambiguous risk. …
WebWe examine the characteristics of the optimal insurance contract under linear transaction costs and an ambiguous distribution of losses. Under the standard expected utility model, we know from Arrow (1965) that it contains a straight deductible. In this paper, we assume that the policyholder is ambiguity averse in the sense of Klibanoff et al. (Econometrica … WebOptimal insurance design of ambiguous risks 557 tract when the distribution of losses is ambiguous and the policyholder is ambiguity averse.1 We assume that the policyholder is …
WebWe also show that the policyholder’s ambiguity aversion may have the counterintuitive effect to reduce the optimal insurance coverage of an ambiguous risk. We examine the … WebAmbiguity Ambiguous averse forest owners will select higher insurance premiums and Insurance for a risk with ambiguous probability than for a risk with non-ambiguous probability. 3 Experimental design We designed an experiment to test the predictions of the theoretical model of insurance behavior introduced in the previous section. 3.1 Stimuli We …
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WebMay 11, 2024 · This paper presents analytical representations for an optimal insurance contract under distortion risk measure and in the presence of model uncertainty. We … normal prevertebral soft tissues radiologyWebChristian Gollier, “Optimal insurance design of ambiguous risks”, Economic Theory, Springer Berlin / Heidelberg, vol. 57, n. 3, November 2014, pp. 555–576. normal pressure in eye in adultsWeb560 C. Gollier The generalization of this result in the case of ambiguity aversion can be summarized as follows. Proposition 2 When τ = 0, the optimal contract entails full insurance, i.e.,I(x) = x for all x. When τ>0, there exists a subset of losses of positive measure G such that I(x) = 0. Proof Whenτ = 0,itiseasytocheckthatthefirst-orderconditions(10)and(11)are normal pressure on pool filterOptimal insurance design of ambiguous risks Christian Gollier Economic Theory 57 , 555–576 ( 2014) Cite this article 731 Accesses 48 Citations Metrics Abstract We examine the characteristics of the optimal insurance contract under linear transaction costs and an ambiguous distribution of losses. See more Suppose that for all u in the domain of \phi , with t\in {\mathbb {R}} and \psi is a smooth increasing and concave function. We examine the … See more Suppose that I(x_1) is positive, so that condition (10) holds as an equality for x=x_1. Suppose by contradiction that w(x_1) is larger than the certainty equivalent wealth w^{m} conditional to x\ne x_1, which is … See more Property i is a direct consequence of Proposition 4, since the degree of ambiguity is constant in all unambiguous states x\notin \left\{ {x_1,x_2}\right\} . Let D_0be defined by the following condition: We first show that … See more In the following Lemma, we take the distorted cdf H as exogenous, and we explore the link that exists between the likelihood ratio dG(x)/dH(x)and the design of the optimal contract. See more normal prevertebral thicknessWeboptimal insurance coverage. The intuition suggests that it should increase the demand for insurance, but we show that this is not true in general. In particular, the demand for … how to remove scratches from automotive glassWebOptimal insurance design of ambiguous risks Downloadable (with restrictions)! We examine the characteristics of the optimal insurance contract under linear transaction costs and … normal price for dry cleaningWebOptimal insurance design of ambiguous risks 557 tract when the distribution of losses is ambiguous and the policyholder is ambiguity averse.1 … how to remove scratches from bathtub