Dynamic Pricing Regulation and Welfare in Insurance Markets

• 成果类型: Article
• 署名作者: Aizawa, Naoki; Ko, Ami
• 署名单位: University of Wisconsin System; University of Wisconsin Madison; National Bureau of Economic Research; Georgetown University
• 刊物名称: JOURNAL OF POLITICAL ECONOMY
• ISSN/ISSBN: 0022-3808
• DOI: 10.1086/735512
• 发表日期: 2025
• 页码: 2371-2413
• 关键词: long-term-care; private information; free entry

摘要

While the traditional role of insurers is to provide protection against individuals' idiosyncratic risks, insurers themselves face substantial uncertainties due to aggregate shocks. To prevent insurers from passing these aggregate risks onto consumers, governments have increasingly adopted dynamic pricing regulations, which limit insurers' ability to change premiums over time. We evaluate dynamic pricing regulation using an equilibrium model of the US long-term care insurance market, featuring insurers' lack of commitment and endogenous market structures. We find that stricter dynamic pricing regulation has a limited impact on improving consumer welfare, while it reduces insurer profits and increases market concentration.