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An Empirical Examination of Information Barriers to Trade in Insurance

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  • Tomas Philipson
  • John Cawley

Abstract

This paper uses direct evidence to evaluate whether asymmetric information is a barrier to trade in the largest market for private insurance in the world: life insurance. We report several findings that seem difficult to reconcile with the conventional theory of insurance under asymmetric information. We conjecture that sellers may know their costs of production better than consumers in this market, as in those for most other products.

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File URL: http://www.aeaweb.org/articles.php?doi=10.1257/aer.89.4.827
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Bibliographic Info

Article provided by American Economic Association in its journal American Economic Review.

Volume (Year): 89 (1999)
Issue (Month): 4 (September)
Pages: 827-846

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Handle: RePEc:aea:aecrev:v:89:y:1999:i:4:p:827-846

Note: DOI: 10.1257/aer.89.4.827
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  12. John Cawley & Tomas Philipson, 1997. "An Empirical Examination of Information Barriers to Trade inInsurance," University of Chicago - George G. Stigler Center for Study of Economy and State 132, Chicago - Center for Study of Economy and State.
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