Logo Logo
Switch Language to German

Peter, Richard; Richter, Andreas ORCID logoORCID: https://orcid.org/0000-0002-2588-4813 and Thistle, Paul (November 2013): Endogenous Information and Adverse Selection under Loss Prevention.

Full text not available from 'Open Access LMU'.


We examine the endogenous value of information in an insurance market with potential adverse selection in the efficiency of prevention technology. By introducing observable preventive effort for all risk types classification risk might be overcome: If decision-makers adjust their prevention behavior to the information acquired, information might be valuable. Consequently, a first-best efficient risk allocation does not necessarily deter information acquisition. Allowing for prevention does not change the ordering of the value of information across disclosure regimes compared to a situation without prevention. This has important policy implications for the areas of genetic testing, HIV testing and product liability.

Actions (login required)

View Item View Item