Browsing by Subject "Insurance"
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Item Essays on Competition in Health Insurance(2021-06) Ryan, ConorThis dissertation consists of three chapters. In the first chapter, with coauthors Roger Feldman and Stephen Parente, I use a novel data set from a private online marketplace to estimate the demand for individual health insurance among a set comprising many high-income consumers across 18 states. We find that consumers earning more than 4 times the federal poverty level are willing to pay $30 to $135 per month to increase the actuarial value of their insurance by 10 percentage points, much less than low-income consumers. In the second chapter, I show that regulations to address adverse selection and competition policy should be considered complements. To see the relationship, consider the incentive for a firm to offer a product that appeals to low-risk consumers and leads high-risk consumers to purchase insurance elsewhere. This incentive problem, which leads to inefficient consumer sorting, is worst in highly competitive markets and absent in a monopoly. I estimate a model of the individual insurance market by combining the data from chapter one with a risk prediction model to relate preferences to marginal cost. I find that the largest welfare cost in the non-group market comes from high markups. Distortions coming from extensive margin selection and inefficient sorting are significantly addressed by current policies targeting adverse selection which are successful in improving total welfare. However, in the most concentrated markets, insurance firms recapture most of the added surplus through higher markups. In the final chapter, I study the effect of competition on medical consumption through the cost-sharing terms---e.g. copays and coinsurance rates--- of the insurance products. These terms determine the out-of-pocket price of medical care, which affect a patient's medical decisions and thus the patient's health outcomes. Using medical claims data linked to insurance products, I estimate a model of imperfect competition that incorporates adverse selection, moral hazard, and selection on moral hazard. First, I show that, on average, less competition leads to higher levels of cost-sharing but multi-product firms respond by increasing the cost-sharing levels of some products and decreasing others. Second, I find that medical consumption and health respond to cost-sharing terms. A $10 increase in the primary care copay leads to a 5.4% decrease in medical consumption and a 0.1 percentage point increase in inpatient mortality. Putting these results together, I find that a reduction in competition via a merger leads to up to a 4% increase in the primary care copay, an average reduction in medical spending of $17 per person, and an additional six inpatient deaths per year. At estimates of the statistical value of a life, the reduction in spending is more than outweighed by the cost of additional deaths.Item Managing risk, managing race: racialized actuarial science in the United States, 1881-1948(2013-05) Wiggins, Benjamin AlanThis dissertation investigates how insurers and the United States government relied on the supposed neutrality of actuarial science to justify their racially discriminatory policies. It argues that the use of race as a variable in the statistical assessment of risk transformed the nature of racism and, in turn, ushered racial disparities in health, wealth, and incarceration from the nineteenth century into the twentieth. Specifically, it investigates the explicit use of race in the actuarial formulas of insurers such as Prudential, in prison management and parole-hearing risk assessments, and in the underwriting manual used for the mortgage insurance decisions of the Federal Housing Administration. It finds that already by the dawn of the twentieth century, leading actuaries and statisticians knew that the social and environmental conditions concomitant with slavery, genocide, and indentured servitude distributed risk inequitably among races. However, capital was ambivalent about the wrongs of the past and the state viewed itself as responsible more for the welfare of capital than for the welfare of its citizens of color when it entered the insurance game during the New Deal.Item Minutes: Senate Committee on Finance and Planning: Subcommittee on Twin Cities Facilites and Support Services: December 20, 2006(University of Minnesota, 2006-12-20) University of Minnesota: Subcommittee on Twin Cities Facilities and Support ServicesItem Three Essays in Agricultural Economics(2022-07) Boyd Leon, ChrisThe three essays that compose this dissertation are on the topic of risk in agriculture in developing countries, where farmers are completely exposed to these risks. The first two chapters focus on price risk and the third focuses on the risk derived from atypical rainfall levels. In the first essay, I address the impacts of a temporary price support policy (a policy that stabilizes and increases prices), in Peru, on the welfare of farmers it aimed to benefit. I exploit the geographical discontinuity of the policy to casually estimate its impacts using differences-in-differences. I find that although the average potato farmer did not significantly change their total consumption due to the policy, the groups of net consumers, farmers with larger shares of potato on total farm sales, and larger farmers increase their consumption due to the price support. Moreover, I find these positive impacts vanish or become negative one year after the policy implementation, suggesting that price support policies are only effective in the short run and for farmers with certain characteristics. In the second essay, I study the production behavior of farmers when introducing a price insurance, i.e., an insurance that stabilizes prices and increases low prices. To assess the causal and pure impact of price risk and price insurance on production behavior, I run an artefactual lab-in-the-field experiment with farmers in Peru. In the experiment, farmers played three games in random order: a baseline game where only price risk exists and it is introduced randomly; a second game where both price risk and an actuarially fair mandatory price insurance exist; and a third game where price risk and the price insurance exist, but the insurance is voluntary and random discounts (of 0%, 50%, or 100%) on the premium are offered. My results suggest that, on average, (i) price risk does not significantly change production relative to price certainty and (ii) neither does the provision of compulsory insurance against price risk, but (iii) the introduction of voluntary insurance causes the average producer on the market to produce more in situations of price risk than in situations of price certainty. Additionally, I find that even in the absence of premium discounts, the insurance against price risk would have a large (i.e., 70-percent) take-up rate. In the third essay, I study how rainfall shocks (i.e., rainfall deviations from the mean) affect rural labor and child health, and I assess the role of mothers’ time use on child nutrition, among rural families in Uganda. My results show that less rainfall in the last month decreases mothers’ timeshare in housework, increases her share in other household-related activities (e.g., fetching water), and does not change her timeshare at the household farm. Less rainfall in the last month also decreases child nutrition. Nonetheless, using mediation analysis, I find that none of the mother’s time-use variables appears to be a mediating factor between rainfall variability and child nutrition. These results suggest that mothers adjust their time-use due to rainfall variability with the objective of preserving their children’s nutrition levels.