Date of Award
9-3-2009
Degree Type
Dissertation
Degree Name
Doctor of Philosophy (PhD)
Department
Risk Management and Insurance
First Advisor
Ajay Subramanian - Chair
Second Advisor
Susan Laury
Third Advisor
George Zanjani
Fourth Advisor
Richard Phillips
Fifth Advisor
Martin Grace
Abstract
This dissertation includes two essays on adverse selection and moral hazard problems in reinsurance markets. The first essay builds a competitive principal-agent model that considers adverse selection and moral hazard jointly, and characterizes graphically various forms of separating Nash equilibria. In the second essay, we use panel data on U.S. property liability reinsurance for the period 1995-2000 to test for the existence of adverse selection and moral hazard. We find that (1) adverse selection is present in private passenger auto liability reinsurance market and homeowners reinsurance market, but not in product liability reinsurance market; (2) residual moral hazard does not exist in all the three largest lines of reinsurance, but is present in overall reinsurance markets; and (3) moral hazard is present in the product liability reinsurance market, but not in the other two lines of reinsurance.
DOI
https://doi.org/10.57709/1059055
Recommended Citation
Yan, Zhiqiang, "Reinsurance Contracting with Adverse Selection and Moral Hazard: Theory and Evidence." Dissertation, Georgia State University, 2009.
doi: https://doi.org/10.57709/1059055