The deadweight gain of insurance taxation when risky activities are optional

• 成果类型: Article
• 署名作者: de Meza, David; Xie, Gang
• 署名单位: University of London; London School Economics & Political Science
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/j.jpubeco.2014.02.004
• 发表日期: 2014
• 页码: 109-116
• 关键词: insurance; tax; Deadweight gain; Hidden types

摘要

Some risky activities are optional, for example motoring. Participation in them is most attractive for good risks, creating a tendency for advantageous selection in the associated insurance market. Taxing insurance consequently yields deadweight gains when type is hidden. Results are strengthened if optimism is present. Finally, endogenising participation implies that the standard positive correlation test for the presence of policy relevant asymmetric information may fail. (C) 2014 Elsevier B.V. All rights reserved.