Goepffarth, Dirk - In: Journal of Economics and Statistics (Jahrbuecher fuer … 227 (2007) 5+6, pp. 485-501
This article reviews the basic theoretical model of risk adjustment (Glazer/McGuire 2000) with a special focus on a … will need a risk adjustment scheme acting on a signal to accomplish both aims. With an imperfect signal this result will … adjustment scheme (optimal risk adjustment). The model is then extended to derive results on the associated incentives regarding …