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Self-protection and insurance with interdependencies

Author: Alexander Muermann; Howard Kunreuther; National Bureau of Economic Research.
Publisher: Cambridge, Mass. : National Bureau of Economic Research, 2007.
Series: Working paper series (National Bureau of Economic Research), no. 12827.
Edition/Format:   eBook : Document : EnglishView all editions and formats
Summary:
"We study optimal investment in self-protection of insured individuals when they face interdependencies in the form of potential contamination from others. If individuals cannot coordinate their actions, then the positive externality of investing in self-protection implies that, in equilibrium, individuals underinvest in self-protection. Limiting insurance coverage through deductibles can partially internalize this  Read more...
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Additional Physical Format: Print version:
Muermann, Alexander.
Self-protection and insurance with interdependencies.
Cambridge, Mass. : National Bureau of Economic Research, 2007
(DLC) 2007615063
Material Type: Document, Internet resource
Document Type: Internet Resource, Computer File
All Authors / Contributors: Alexander Muermann; Howard Kunreuther; National Bureau of Economic Research.
OCLC Number: 77706925
Description: 1 online resource (1 volume).
Series Title: Working paper series (National Bureau of Economic Research), no. 12827.
Responsibility: Alexander Muermann, Howard Kunreuther.

Abstract:

"We study optimal investment in self-protection of insured individuals when they face interdependencies in the form of potential contamination from others. If individuals cannot coordinate their actions, then the positive externality of investing in self-protection implies that, in equilibrium, individuals underinvest in self-protection. Limiting insurance coverage through deductibles can partially internalize this externality and thereby improve individual and social welfare"--National Bureau of Economic Research web site.

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