Advanced Search
MyIDEAS: Login to save this article or follow this journal

A review of recent theoretical and empirical analyses of asymmetric information in road safety and automobile insurance

Contents:

Author Info

  • Dionne, Georges
  • Michaud, Pierre-Carl
  • Pinquet, Jean

Abstract

Road safety policies and automobile insurance contracts often use incentive mechanisms based on traffic violations and accidents to promote safe driving. Can these mechanisms improve road safety efficiently? Do they reduce asymmetric information between drivers and insurers and regulators? In other words, is there residual asymmetric information in observed distributions of accidents and infractions? We answer these questions in this article by reviewing recent theoretical and empirical results that rest on various data and methodologies. We present recent tests related to the identification of residual asymmetric information in road safety management and in automobile insurance contracting. We also propose a theoretical analysis of the foundations of point-record driver's licenses observed around the world.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.sciencedirect.com/science/article/pii/S0739885912002107
Download Restriction: Full text for ScienceDirect subscribers only

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Article provided by Elsevier in its journal Research in Transportation Economics.

Volume (Year): 43 (2013)
Issue (Month): 1 ()
Pages: 85-97

as in new window
Handle: RePEc:eee:retrec:v:43:y:2013:i:1:p:85-97

Contact details of provider:
Web page: http://www.elsevier.com/wps/find/journaldescription.cws_home/620614/description#description

Order Information:
Postal: http://www.elsevier.com/wps/find/supportfaq.cws_home/regional
Web: https://shop.elsevier.com/order?id=714194&ref=714194_01_ooc_2&version=01

Related research

Keywords: Road safety; Point-record driver's license; Asymmetric information; Road safety management; Empirical test;

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Dionne, G. & Vanasse, C., 1988. "Automobile Insurance Ratemaking in the Presence of Asymmetric Information," Cahiers de recherche 8834, Universite de Montreal, Departement de sciences economiques.
  2. repec:rje:randje:v:37:y:2006:i:4:p:783-798 is not listed on IDEAS
  3. Georges Dionne & Casey G. Rothschild, 2011. "Risk Classification in Insurance Contracting," Cahiers de recherche 1137, CIRPEE.
  4. Rothschild, Michael & Stiglitz, Joseph E, 1976. "Equilibrium in Competitive Insurance Markets: An Essay on the Economics of Imperfect Information," The Quarterly Journal of Economics, MIT Press, vol. 90(4), pages 630-49, November.
  5. Boyer, Marcel & Dionne, Georges, 1989. "An Empirical Analysis of Moral Hazard and Experience Rating," The Review of Economics and Statistics, MIT Press, vol. 71(1), pages 128-34, February.
  6. Dionne, G. & Doherty, N. & Fombaron, N., 2000. "Adverse Selection in Insurance Markets," Ecole des Hautes Etudes Commerciales de Montreal- 00-05, Ecole des Hautes Etudes Commerciales de Montreal-Chaire de gestion des risques..
  7. Crocker, Keith J & Snow, Arthur, 1986. "The Efficiency Effects of Categorical Discrimination in the Insurance Industry," Journal of Political Economy, University of Chicago Press, vol. 94(2), pages 321-44, April.
  8. Chiappori, Pierre-Andre & Macho, Ines & Rey, Patrick & Salanie, Bernard, 1994. "Repeated moral hazard: The role of memory, commitment, and the access to credit markets," European Economic Review, Elsevier, vol. 38(8), pages 1527-1553, October.
  9. Alma Cohen & Peter Siegelman, 2010. "Testing for Adverse Selection in Insurance Markets," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 77(1), pages 39-84.
  10. D'Arcy, Stephen P & Doherty, Neil A, 1990. "Adverse Selection, Private Information, and Lowballing in Insurance Markets," The Journal of Business, University of Chicago Press, vol. 63(2), pages 145-64, April.
  11. Devlin, R.A., 1988. "Liability Versus No-Fault Automobile Insurance Regimes: An Analysis Of The Experience In Quebec," Working Papers 88126, Wilfrid Laurier University, Department of Economics.
  12. Pierre-André Chiappori & Bruno Jullien & Bernard Salanié & François Salanié, 2002. "Asymmetric Information in Insurance : General Testable Implications," Working Papers 2002-42, Centre de Recherche en Economie et Statistique.
  13. Jeffrey M. Wooldridge, 2005. "Simple solutions to the initial conditions problem in dynamic, nonlinear panel data models with unobserved heterogeneity," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 20(1), pages 39-54.
  14. Georges DIONNE & Pascal ST-AMOUR & Desire VENCATACHELLUM, . "Asymmetric Information and Adverse Selection in Mauritian Slave Auctions," Swiss Finance Institute Research Paper Series 08-40, Swiss Finance Institute.
  15. Boyer, Marcel & Dionne, Georges, 1987. "The economics of road safety," Transportation Research Part B: Methodological, Elsevier, vol. 21(5), pages 413-431, October.
  16. Liangjun Su & Martin Spindler, 2013. "Nonparametric Testing for Asymmetric Information," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 31(2), pages 208-225, April.
  17. De Meza, D. & Webb, D.C., 2000. "Advantageous Selection in Insurance Market," Discussion Papers 0007, Exeter University, Department of Economics.
  18. Jaap Abbring & Pierre-André Chiappori & Tibor Zavadil, 2008. "Better Safe than Sorry? Ex Ante and Ex Post Moral Hazard in Dynamic Insurance Data," Tinbergen Institute Discussion Papers 08-075/3, Tinbergen Institute.
  19. C. Bolancé & M. Guillén & J. Pinquet, 2002. "Time-varying credibility for frequency risk models : Estimation and tests for autoregressive specifications on the random effects," THEMA Working Papers 2002-18, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
  20. Eric Helland & Alexander Tabarrok, 2007. "Does Three Strikes Deter?: A Nonparametric Estimation," Journal of Human Resources, University of Wisconsin Press, vol. 42(2).
  21. Marie-Cécile Fagart & Claude Fluet, 2009. "Liability insurance under the negligence rule," RAND Journal of Economics, RAND Corporation, vol. 40(3), pages 486-508.
  22. Jaap H. Abbring & Pierre-Andre Chiappori, 2004. "Moral Hazard and Dynamic Insurance Data," 2004 Meeting Papers 316, Society for Economic Dynamics.
  23. Dionne, G. & Vanasse, C., 1988. "A Generalization of Automobile Insurance Rating Models: the Negative Binomial Distribution with a Regression Component," Cahiers de recherche 8833, Universite de Montreal, Departement de sciences economiques.
  24. J. David Cummins & Mary A. Weiss & Richard D. Phillips, 1999. "The Incentive Effects of No Fault Automobile Insurance," Center for Financial Institutions Working Papers 99-38, Wharton School Center for Financial Institutions, University of Pennsylvania.
  25. Shavell, Steven, 1987. "The Optimal Use of Nonmonetary Sanctions as a Deterrent," American Economic Review, American Economic Association, vol. 77(4), pages 584-92, September.
  26. Sloan, Frank A & Reilly, Bridget A & Schenzler, Christoph, 1995. "Effects of Tort Liability and Insurance on Heavy Drinking and Drinking and Driving," Journal of Law and Economics, University of Chicago Press, vol. 38(1), pages 49-77, April.
  27. Georges Dionne & Pierre-Carl Michaud & Maki Dahchour, 2010. "Separating Moral Hazard from Adverse Selection and Learning in Automobile Insurance: Longitudinal Evidence from France," Cahiers de recherche 1035, CIRPEE.
  28. Pauly, Mark V, 1974. "Overinsurance and Public Provision of Insurance: The Roles of Moral Hazard and Adverse Selection," The Quarterly Journal of Economics, MIT Press, vol. 88(1), pages 44-62, February.
  29. Georges Dionne & Olfa Ghali, 2003. "The (1992) Bonus-Malus System in Tunisia: An Empirical Evaluation," THEMA Working Papers 2003-40, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
  30. Boyer, M. & Dionee, G. & Vanasse, C., 1990. "Econometric Models Of Accident Distributions," Cahiers de recherche 9001, Centre interuniversitaire de recherche en économie quantitative, CIREQ.
  31. Georges Dionne & Robert Gagné, 2001. "Deductible Contracts Against Fraudulent Claims: Evidence From Automobile Insurance," The Review of Economics and Statistics, MIT Press, vol. 83(2), pages 290-301, May.
  32. Landes, Elisabeth M, 1982. "Insurance, Liability, and Accidents: A Theoretical and Empirical Investigation of the Effect of No-Fault Accidents," Journal of Law and Economics, University of Chicago Press, vol. 25(1), pages 49-65, April.
  33. John D. Graham & Steven Garber, 1984. "Evaluating the effects of automobile safety regulation," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 3(2), pages 206-224.
  34. Dionne, G. & Doherty, N., 1991. "Adverse Selection, Commitment and Renegotiation : Extention to and Evidence From Insurance Markets," Cahiers de recherche 9134, Centre interuniversitaire de recherche en économie quantitative, CIREQ.
  35. Georges Dionne & Christian Gourieroux & Charles Vanasse, 2001. "Testing for Evidence of Adverse Selection in the Automobile Insurance Market: A Comment," Journal of Political Economy, University of Chicago Press, vol. 109(2), pages 444-473, April.
  36. Pierre-Carl Michaud & Konstantinos Tatsiramos, 2008. "Fertility and Female Employment Dynamics in Europe: The Effect of Using Alternative Econometric Modeling Assumptions," Working Papers 643, RAND Corporation Publications Department.
  37. Georges Dionne & Mélissa La Haye & Anne-Sophie Bergères, 2010. "Does Asymmetric Information Affect the Premium in Mergers and Acquisitions?," Cahiers de recherche 1015, CIRPEE.
  38. Peltzman, Sam, 1975. "The Effects of Automobile Safety Regulation," Journal of Political Economy, University of Chicago Press, vol. 83(4), pages 677-725, August.
  39. Alma Cohen, 2005. "Asymmetric Information and Learning: Evidence from the Automobile Insurance Market," The Review of Economics and Statistics, MIT Press, vol. 87(2), pages 197-207, May.
  40. Georges Dionne & Jean Pinquet & Mathieu Maurice & Charles Vanasse, 2011. "Incentive Mechanisms for Safe Driving: A Comparative Analysis with Dynamic Data," The Review of Economics and Statistics, MIT Press, vol. 93(1), pages 218-227, February.
  41. Didier Richaudeau, 1999. "Automobile Insurance Contracts and Risk of Accident: An Empirical Test Using French Individual Data," The Geneva Risk and Insurance Review, Palgrave Macmillan, vol. 24(1), pages 97-114, June.
  42. Jean-Marc Bourgeon & Pierre Picard, 2007. "Point-record driving licence and road safety : an economic approach," Post-Print hal-00243024, HAL.
  43. DIONNE, Georges & LASSERRE, Pierre, . "Adverse selection, repeated insurance contracts and announcement strategy," CORE Discussion Papers RP -658, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  44. Kuniyoshi Saito, 2006. "Testing for Asymmetric Information in the Automobile Insurance Market Under Rate Regulation," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 73(2), pages 335-356.
  45. Joseph J. Doyle Jr., 2005. "Health Insurance, Treatment and Outcomes: Using Auto Accidents as Health Shocks," NBER Working Papers 11099, National Bureau of Economic Research, Inc.
  46. Fang, Hanming & Keane, Michael & Silverman, Dan, 2006. "Sources of Advantageous Selection: Evidence from the Medigap Insurance Market," Working Papers 17, Yale University, Department of Economics.
  47. P. Picard, 2000. "Les nouveaux enjeux de la régulation des marchés d'assurance," THEMA Working Papers 2000-53, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
  48. Dionne, G. & Maurice, M. & Pinquet, J. & Vanasse, C., 2001. "The Role of Memory in Long-Term Contracting with Moral Hazard: Empirical Evidence in Automobile Insurance," Ecole des Hautes Etudes Commerciales de Montreal- 01-05, Ecole des Hautes Etudes Commerciales de Montreal-Chaire de gestion des risques..
  49. Mary A. Weiss & Sharon Tennyson & Laureen Regan, 2010. "The Effects of Regulated Premium Subsidies on Insurance Costs: An Empirical Analysis of Automobile Insurance," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 77(3), pages 597-624.
  50. G. Dionne, 2000. "The Empirical Measure of Information Problems with Emphasis on Insurance Fraud," THEMA Working Papers 2000-20, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
  51. Wilson, Charles, 1977. "A model of insurance markets with incomplete information," Journal of Economic Theory, Elsevier, vol. 16(2), pages 167-207, December.
  52. Igal Hendel & Alessandro Lizzeri, 2000. "The Role of Commitment in Dynamic Contracts: Evidence from Life Insurance," NBER Working Papers 7470, National Bureau of Economic Research, Inc.
  53. Hyojoung Kim & Doyoung Kim & Subin Im & James W. Hardin, 2009. "Evidence of Asymmetric Information in the Automobile Insurance Market: Dichotomous Versus Multinomial Measurement of Insurance Coverage," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 76(2), pages 343-366.
  54. J. Pinquet, 1997. "Experience rating through heterogeneous models," THEMA Working Papers 97-25, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
  55. Dahlby, B. G., 1983. "Adverse selection and statistical discrimination : An analysis of Canadian automobile insurance," Journal of Public Economics, Elsevier, vol. 20(1), pages 121-130, February.
  56. Jaap Abbring & Pierre-André Chiappori & Tibor Zavadil, 2008. "Better Safe than Sorry? Ex Ante and Ex Post Moral Hazard in Dynamic Insurance Data," Tinbergen Institute Discussion Papers 08-075/3, Tinbergen Institute.
  57. Puelz, Robert & Snow, Arthur, 1994. "Evidence on Adverse Selection: Equilibrium Signaling and Cross-Subsidization in the Insurance Market," Journal of Political Economy, University of Chicago Press, vol. 102(2), pages 236-57, April.
  58. Joseph J. Doyle, 2005. "Health Insurance, Treatment and Outcomes: Using Auto Accidents as Health Shocks," The Review of Economics and Statistics, MIT Press, vol. 87(2), pages 256-270, May.
  59. Shavell, Steven, 1979. "On Moral Hazard and Insurance," The Quarterly Journal of Economics, MIT Press, vol. 93(4), pages 541-62, November.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Ciprian Matis & Eugenia Matis, 2013. "Asymmetric Information In Insurance Field: Some General Considerations," Annales Universitatis Apulensis Series Oeconomica, Faculty of Sciences, "1 Decembrie 1918" University, Alba Iulia, vol. 1(15), pages 17.
  2. Georges Dionne, 2012. "The Empirical Measure of Information Problems with Emphasis on Insurance Fraud and Dynamic Data," Cahiers de recherche 1233, CIRPEE.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:eee:retrec:v:43:y:2013:i:1:p:85-97. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.