Chapter 9
Properties of Information
Properties of Information
The Value of Information
The Value of Information
The Value of Information
The Value of Information
The Value of Information
The Value of Information
The Value of Information
Asymmetry of Information
Information and Insurance
Moral Hazard
Moral Hazard
Moral Hazard
Moral Hazard
Behavior with Insurance and Perfect Monitoring
Behavior with Insurance and Perfect Monitoring
Behavior with Insurance and Perfect Monitoring
Moral Hazard
Moral Hazard
Adverse Selection
Adverse Selection
Adverse Selection Both individuals would prefer to move to the certainty line if premiums are actuarially fair
Adverse Selection
Adverse Selection
Adverse Selection One possible solution would be for the insurer to offer premiums based on the average probability of loss
Adverse Selection
Adverse Selection
Adverse Selection
Adverse Selection
Adverse Selection
Adverse Selection
The Principal-Agent Relationship
The Principal-Agent Relationship
The Principal-Agent Relationship
The Principal-Agent Relationship
The Principal-Agent Relationship
The Principal-Agent Relationship
The Principal-Agent Relationship
The Principal-Agent Relationship
The Principal-Agent Relationship
Using the Corporate Jet
Using the Corporate Jet
Using the Corporate Jet
Using the Corporate Jet
The Owner-Manager Relationship
The Owner-Manager Relationship
The Owner-Manager Relationship
The Owner-Manager Relationship
Asymmetric Information
Hidden Action
Hidden Action
Hidden Information
Important Points to Note:
Important Points to Note:
Important Points to Note:
Important Points to Note:
Important Points to Note:
Important Points to Note: