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Asymmetric Information In Insurance Field: Some General Considerations

Author

Listed:
  • Ciprian Matis

    (Babes-Bolyai University Cluj-Napoca Romania)

  • Eugenia Matis

    (Babes-Bolyai University Cluj-Napoca Romania)

Abstract

Our review aims to assess theoretical and empirical studies concerning the existence,magnitude and threats of information asymmetry in insurance field. Based on the fact that most ofthe papers examined approached both static and dynamic frameworks, a particular emphasis is puton the testable consequences that can be derived from existing models as documented in theliterature. The importance of the present study relies in the assessment of the consequences ofinformation asymmetry, which importance increased in the last years. Based on the resultsdocumented by previous studies, we argue that neither the existence nor magnitude can be easilyassessed without a lack of consensus. In this respect we consider the threat regarding informationasymmetry in the insurance market as being not thoroughly founded. We also tried to identify basedon our understanding the causes for inconclusive results obtained so far in the literature.

Suggested Citation

  • 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 1-17.
  • Handle: RePEc:alu:journl:v:1:y:2013:i:15:p:17
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    asymmetric information; inconclusive results; biases; adverse selection; moral hazard;

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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