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Nonexclusivity and adverse selection: An application to the annuity market

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Author Info
Agar Brugiavini
Gwenaël Piaser () (CREFI-LSF, University of Luxembourg)
Abstract

Using a common agency framework, we characterize possible equilibria when annuities contracts are not exclusive. We discuss theoretical and empirical implications of these equilibria. First, we show that at equilibrium prices are not linear. Then we characterize an equilibrium. We provide conditions for existence and show that this equilibrium is efficient.

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Publisher Info
Paper provided by CREFI-LSF, University of Luxembourg in its series Working Papers of CREFI-LSF (Centre of Research in Finance - Luxembourg School of Finance) with number 06-03.

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Date of creation: 2006
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Handle: RePEc:crf:wpaper:06-03

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Web page: http://fdef.uni.lu/index.php/fdef/lux_school_of_finance/crefi_lsf
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Related research
Keywords: Menus Common Agency Insurance Annuity Markets Adverse Selection Efficiency.

Find related papers by JEL classification:
D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information
H5 - Public Economics - - National Government Expenditures and Related Policies
J2 - Labor and Demographic Economics - - Demand and Supply of Labor
G1 - Financial Economics - - General Financial Markets

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  1. Chiappori, Pierre Andre & Salanie, Bernard, 2002. "Testing Contract Theory: A Survey of Some Recent Work," CESifo Working Paper Series CESifo Working Paper No. , CESifo GmbH. [Downloadable!]
  2. Andrea Attar & Eloisa Campioni & Gwenael Piaser, 2006. "Multiple Lending and Constrained Efficiency in the Credit Market," Contributions to Theoretical Economics, Berkeley Electronic Press, vol. 6(1), pages 1253-1253. [Downloadable!] (restricted)
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  3. Amy Finkelstein & James Poterba, 2002. "Selection Effects in the United Kingdom Individual Annuities Market," Economic Journal, Royal Economic Society, vol. 112(476), pages 28-50, January. [Downloadable!] (restricted)
  4. Bruno Biais & David Martimort & Jean-Charles Rochet, 2000. "Competing Mechanisms in a Common Value Environment," Econometrica, Econometric Society, vol. 68(4), pages 799-838, July.
    Other versions:
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