Adverse selection and government intervention in life and health insurance markets

This thesis examines the workings of insurance markets. The first two papers examine the effect of government tax and regulatory policy in markets for supplementary health insurance. The third paper presents new evidence of the importance of adverse selection in insurance markets. The first paper examines the empirical consequences of imposing binding minimum standards on the market for private health insurance for the elderly in the United States. I find robust evidence of a substantial (40 percent) decline in insurance coverage associated with imposing these minimum standards. The standards are also associated with a reduction in coverage of non-mandated benefits among the insured. The minimum standards therefore, while requiring additional insurance coverage among the insured, were also associated with both extensive and intensive declines in insurance coverage. Considering all of these various changes, I estimate that the standards were, on net, welfare reducing. The second paper presents new evidence of the effect of the tax subsidy to employer-provided health insurance on coverage by such insurance.

Department dc:contributor.department

Massachusetts Institute of Technology. Dept. of Economics.

Grantor dc:publisher

Massachusetts Institute of Technology

Year dc:date.issued

2001

Author dc:creator

• Finkelstein, Amy

Advisor dc:contributor.advisor

• James M. Poterba and Jonathan Gruber.

• Economics.

Statement dc:rights

• M.I.T. theses are protected by copyright. They may be viewed from this source for any purpose, but reproduction or distribution in any format is prohibited without written permission. See provided URL for inquiries about permission.

Licence dc:rights.uri

• http://dspace.mit.edu/handle/1721.1/7582

Language dc:language.iso

eng

Handle dc:identifier.uri

http://hdl.handle.net/1721.1/8652

OAI identifier oai:identifier

oai:dspace.mit.edu:1721.1/8652