The Probationary Period as a Screening Device: The Monopolistic Insurer

Stiglitz [1977], considering asymmetry of information in a monopolistic insurance market and the monetary deductible as a screening device, shows that an equilibrium is always of a separating type. High risks buy complete insurance whilst low risks buy partial insurance. In this paper, we show that a pooling equilibrium may exist if a probationary period, rather than the partial coverage in monetary terms, is used as a screening device.JEL Classification No.: D42, D82  

Cream Skimming, Dregs Skimming, and Pooling: On the Dynamics of Competitive Screening

We discuss the existence of a pooling equilibrium in a two-period model of an insurance market with asymmetric information. We solve the model numerically. We pay particular attention to the reasons for non-existence in cases where no pooling equilibrium exists. In addition to the phenomenon of cream skimming emphasized in earlier literature, we here point to the importance of the opposite: dregs skimming, whereby high-risk consumers are profitably detracted from the candidate pooling contract.  

Equilibrium in Competitive Insurance Markets Under Adverse Selection and Yaari's Dual Theory of Risk

Under Yaari's dual theory of risk, we determine the equilibrium separating contracts for high and low risks in a competitive insurance market, in which risks are defined only by their expected losses, that is, a high risk is a risk that has a greater expected loss than a low risk. Also, we determine the pooling equilibrium contract when insurers are assumed non-myopic. Expected utility theory generally predicts that optimal insurance indemnity payments are nonlinear functions of the underlying loss due to the nonlinearity of agents' utility functions. Under Yaari's dual theory, we show that under mild technical conditions the indemnity payment is a piecewise linear function of the loss, a common property of insurance coverages.  

基于博弈论的法律责任与审计师定价策略

以完美贝叶斯均衡赛局模型,研究审计师的法律责任是否会影响审计师的初次审计定价策略。研究发现,若考虑审计师的法律责任,当初次审计合约的签约与前期审计服务质量无直接关联性时,审计定价策略会产生分离均衡;当初次审计合约的签约与前期审计服务质量有直接关联性时,会产生混同均衡。