Uncertainty of Governmental Relief and the Crowding out of Insurance
AbstractThis paper discusses the problem of crowding out of insurance by co-existing governmental relief programs - so-called â€™charity hazardâ€™ - in a context of different institutional schemes of government relief in Austria and Germany. We test empirically whether an assured partial relief scheme (as in Austria) drives a stronger crowding out of private insurance than a scheme promising full relief which is subject to ad hoc political decision making (as in Germany). Our general finding is that the institutional design of governmental relief programs significantly affects the demand for private natural hazard insurance.
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Bibliographic InfoPaper provided by Monash University, Department of Economics in its series Monash Economics Working Papers with number 05-10.
Length: 29 pages
Date of creation: May 2010
Date of revision:
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Postal: Department of Economics, Monash University, Victoria 3800, Australia
Web page: http://www.buseco.monash.edu.au/eco/
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Other versions of this item:
- Paul A. Raschky & Reimund Schwarze & Manijeh Schwindt & Ferdinand Zahn, . "Uncertainty of Governmental Relief and the Crowding out of Insurance," Working Papers 2010-03, Faculty of Economics and Statistics, University of Innsbruck.
- D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
- D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
- G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
- Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters
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