Optimal Contract Regulation in Selection Markets by Andre Veiga

Join us for another event in the Microeconomics Research Seminar Series, Spring Term 2024.

Andre Veiga, from the Department of Finance at Imperial College Business School, will present their research on Optimal Contract Regulation in Selection Markets.

Abstract

We model competitive insurance markets with continuous cost-types. A regulator sets minimum and maximum coverage levels and a fee for non-buyers. Equilibrium is unique if the type distribution is log-concave. Increasing the non-purchase fee increases welfare if the density of types is decreasing. The optimal level of the minimum coverage is positive, below full insurance and induces some pooling at the minimum coverage contract. The optimal level of the maximum coverage is full insurance, even in the presence of moral hazard.

This seminar will be held in the Economics Common Room on Monday 19 February 2024 at 1.30pm. This event is open to all levels of study and is also open to the public.

To register your place and gain access to the webinar, please contact the seminar organisers.

This event is part of the Microeconomics Research Seminar Series.