NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH
loading...

Self-Protection and Insurance with Interdependencies

Alexander Muermann, Howard Kunreuther

NBER Working Paper No. 12827
Issued in January 2007
NBER Program(s):Public Economics

We study optimal investment in self-protection of insured individuals when they face interdependencies in the form of potential contamination from others. If individuals cannot coordinate their actions, then the positive externality of investing in self-protection implies that, in equilibrium, individuals underinvest in self-protection. Limiting insurance coverage through deductibles can partially internalize this externality and thereby improve individual and social welfare.

This paper is available as PDF (219 K) or via email

Acknowledgments

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w12827

Published: Alexander Muermann & Howard Kunreuther, 2008. "Self-protection and insurance with interdependencies," Journal of Risk and Uncertainty, Springer, vol. 36(2), pages 103-123, April.

Users who downloaded this paper also downloaded* these:
Card and Rothstein w12078 Racial Segregation and the Black-White Test Score Gap
Chai, Maurer, Mitchell, and Rogalla w17134 Lifecycle Impacts of the Financial and Economic Crisis on Household Optimal Consumption, Portfolio Choice, and Labor Supply
Reinhart and Rogoff w13882 This Time is Different: A Panoramic View of Eight Centuries of Financial Crises
Seko Housing Finance in Japan
Morck, Stangeland, and Yeung w6814 Inherited Wealth, Corporate Control and Economic Growth: The Canadian Disease
 
Publications
Activities
Meetings
NBER Videos
Themes
Data
People
About

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us