A Model of Insurance Markets with Incomplete Information.¶

Wilson, C. (1977). A Model of Insurance Markets with Incomplete Information. Journal of Economic Theory, 0531(77), 167-207.

Type: Journal article
Intellectual base: Primary research
Year: 1977
DOI: 10.1016/0022-0531(77)90004-7
Link: https://doi.org/10.1016/0022-0531(77)90004-7
Cited from: economics_finance, information_theory

Cited by¶

4 citations across 4 artifacts.

Each citation links to the sentence it supports in the citing article.

Primes¶

Adverse Selection
- Wilson (1977)
  This sourceIntroduces the 'anticipatory' (Wilson) equilibrium: each firm assumes any policy that becomes unprofitable after its own offer is withdrawn, restoring existence where the Rothschild-Stiglitz static-expectations equilibrium fails — supports the prime's T4 refinement attributing the anticipatory-equilibrium concept to Wilson. (Existing DOI verified as correct.)
Auction Theory
- This sourceFoundational analysis of equilibrium in insurance markets with adverse selection, including pooling vs. separating equilibria and the role of participation constraints when the outside option dominates the offered menu.
Screening
- T2: Incentive-Compatibility Within Menu vs Walk-Away to Outside Option.
  This sourceFoundational analysis of equilibrium in insurance markets with adverse selection, including pooling vs. separating equilibria and the role of participation constraints when the outside option dominates the offered menu.
Winner's Curse
- The curse arises from the geometry of competitive selection alone, which is why the rational correction — bid not your unconditional estimate of value but your estimate conditioned on the hypothesis that yours is the highest of N estimates — is the canonical remedy and the structural heart of the prime.
  This sourceFoundational analysis of equilibrium in insurance markets with adverse selection, including pooling vs. separating equilibria and the role of participation constraints when the outside option dominates the offered menu.

Verification¶

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