Browsing by Subject "Asymmetrische Information"

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Essays on long-term care and health insurance
(2018) Schreckenberger, Christopher Karl Ludwig; Schiller, Jörg
This thesis contributes to the literature on the impact of two individual options that may help to alleviate the financial pressure on the public sector with respect to health and long-term care expenditures. A particular focus is on the German health insurance and long-term care insurance (LTCI) system. The first option refers to the shifting of LTCI and health insurance coverage from a public system to markets for voluntary private health insurance (VPHI) and private LTCI. These private insurance markets may suffer from inefficiencies due to asymmetric information and selection effects, such as adverse selection. Hence, three papers in this thesis analyze selection effects in markets for VPHI and private LTCI. The first paper (chapter 2) reviews the empirical work on asymmetric information and related selection effects in markets for private LTCI and in the U.S. market for Medigap insurance. After providing an overview of the existence of selection effects in these markets, the review examines the evidence on several potential sources of selection. Regarding the latter, a focus is on the role of private information that individuals have on their risk type, on the role of the individual’s risk preferences and of sociodemographic characteristics. Following the review, two empirical papers analyze selection effects in the German markets for complementary private LTCI (chapter 3) and for supplemental dental insurance (chapter 4). Both markets have in common that they provide voluntary private insurance coverage for residual out-of-pocket expenditure risks not covered by statutory LTCI or health insurance in Germany. In addition, the ex-ante premium differentiation is rather limited in these markets. This makes these markets prone to selection effects. Using a large dataset on more than 98,000 individuals from a German private insurance company, the findings in chapter 3 suggest that advantageous selection is the dominating type of selection in the German market for complementary private LTCI. Examining potential drivers for selection, the analysis indicates that the occupation as well as the residential location are observable characteristics that are not used for pricing, but that contribute to advantageous selection through the socioeconomic status. The holding of supplemental health insurance policies is another observable attribute that affects the selection behavior. Analyzing the selection behavior within a dynamic framework, the analysis shows that the uptake and the cancellation of LTCI policies are associated with changes in health insurance payouts. Moreover, individuals with financial problems and with a lower socioeconomic status are more likely to drop complementary LTCI coverage. Based on survey data from the Healthcare Monitor of the Bertelsmann Stiftung, the findings in chapter 4 do not reveal a significant correlation between insurance coverage and risk in the market for supplemental dental insurance in Germany. Since one possible explanation for this finding is heterogeneous selection leading to an offsetting of adverse and advantageous selection, a large set of potential sources of selection effects is tested. The results indicate that the holding of other supplemental health insurance policies is a main driver for advantageous selection in this market. The findings in this chapter provide solid evidence that this insurance market suffers from asymmetric information and selection effects even though the correlation between insurance coverage and risk is not statistically significant. Instead of shifting insurance coverage to a private insurance system, another option to alleviate the financial burden in a public health insurance system, which is analyzed in this thesis, refers to the promotion of preventive health care. Specifically, the fourth paper (chapter 5) empirically examines the effectiveness of a nationwide population-based skin cancer screening (SCS) program that was implemented in Germany in 2008. To this end, panel data from 2000 to 2013 of the Eurostat database on subregions in 22 European countries are exploited. Using fixed effects methods, the results show a positive and robust effect of the German SCS program on the diagnosis rate for malignant skin neoplasms, but no significant impact on the melanoma mortality rate. The former suggests that this program is effective in terms of an increased diagnosis rate for malignant skin neoplasms and may therefore contribute to an improved detection of skin cancer at an early stage.
Die Integration der Marktperspektive in der Steuerung von Problemkrediten
(2015) Englert, Jan Patrick; Burghof, Hans-Peter
The treatment of non-performing loans by banks will remain relevant for the foreseeable future given the recurring nature of bad loan cycles. These cycles differ in their origins as they are triggered by different industries, different countries or a variety of economic contexts. Examples include the bursting of the dotcom bubble and the real estate bubble or the financial crisis in 2008. Likewise, political instability (Russia-Ukraine conflict, financial sanctions), ever-shorter and more volatile economic cycles, cross-border and cross-industry interdependencies, or crises and scandals can cause micro- and macroeconomic uncertainty with the accompanying risk of contagion to the real economy, the financial markets and thereby the credit markets. Almost ten years after the emergence of the financial crisis, European financial institutions are still under pressure, facing high levels of problem- and non-strategic loans. German banks are no exception in having to face these challenges too. Since bank lending still accounts for a dominant share of the market for corporate financing, portfolio steering and credit risk management were, for many years, limited in scope to banks’ internal processes only. An interaction between internal loan processes and capital markets was not foreseen. This has been fundamentally transformed with the emergence of functioning secondary markets for non- and sub-performing loans. These challenges are compelling European banks to address problem loan situations and the efficiency of their loan management processes, something that can only be accomplished through a clean-up of loan portfolios and the institutionalization of professional loan management practices along the entire value chain for problem loans. This requires a re-alignment of the traditional lending business and an anchoring of market-oriented problem loan management within banks’ credit processes. Accordingly, this research paper is based on the hypothesis that the sustainable management of problem loans is impossible without close interaction with capital markets, requiring a reorientation of the traditional lending business to deal with the bad loan business as a core business, even though precisely the opposite is the case.
Quality ambiguity and the market mechanism for credence goods
(2004) Benner, Dietrich
With credence goods consumers cannot judge actual quality neither before purchase - ex ante - nor after purchase - ex post -. Trust has to replace own examination and verification. Applying Choquet-Expected Utility theory, a general model of credence goods is developed which takes the problem of trust explicitly in its view and generalizes the problem of quality uncertainty on the ?market for lemons? of Akerlof (1970) to ?quality ambiguity? with credence goods. The model shows the market mechanism only performing well in providing credence goods when consumers? trust in given information is not too low. With trust too low, sellers of credence goods will be driven out of the market by trust induced adverse selection. In market equilibrium prices will always be lower compared to equilibrium prices for experience goods.