An Empirical Examination of Information Barriers to Trade in Insurance
- 1 September 1999
- journal article
- Published by American Economic Association in American Economic Review
- Vol. 89 (4) , 827-846
- https://doi.org/10.1257/aer.89.4.827
Abstract
This paper uses direct evidence to evaluate whether asymmetric information is a barrier to trade in the largest market for private insurance in the world: life insurance. We report several findings that seem difficult to reconcile with the conventional theory of insurance under asymmetric information. We conjecture that sellers may know their costs of production better than consumers in this market, as in those for most other products. (JEL D8, G1, I1, L0)Keywords
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