We present a simple framework to illustrate the welfare consequences of a “top up” health insurance policy that allows patients to pay the incremental price for more expensive treatment options. We contrast it with common alternative policies that require essentially no incremental payments...

We report results from a validation study of Nielsen Homescan data. We use data from a large grocery chain to match thousands of individual transactions that were recorded by both the retailer (at the store) and the Nielsen Homescan panelist (at home). First, we report how often shopping trips...

We provide a graphical illustration of how standard consumer and producer theory can be used to quantify the welfare loss associated with inefficient pricing in insurance markets with selection. We then show how this welfare loss can be estimated empirically using identifying variation in the...

Much of the extensive empirical literature on insurance markets hasfocused on whether adverse selection can be detected. Once detected, however, therehas been little attempt to quantify its welfare cost, or to assess whether and whatpotential government interventions may reduce these costs. To...