Showing 1 - 7 of 7
We discuss and apply a new measure of competition: the elasticity of a firm's profits with respect to its cost level. A higher value of this profit elasticity (PE) signals more intense competition. Using firm level data we compare PE with the most popular competition measures such as the price...
Persistent link: https://www.econbiz.de/10005248511
The financial crisis has been attributed partly to perverse incentives for traders at banks and has led policy makers to propose regulation of banks' remuneration packages. We explain why poor incentives for traders cannot be fully resolved by only regulating the bank's top executives, and why...
Persistent link: https://www.econbiz.de/10009646397
This paper provides an analysis of exclusive contracts between health care providers and insurers in a model where some consumers choose to stay uninsured. In case of a monopoly insurer, exclusion of a provider changes the distribution of consumers who choose not to insure. Although the...
Persistent link: https://www.econbiz.de/10008633178
The strategic and welfare implications of group contracts for health insurance are not well understood. We estimate a model to determine which factors explain the price of group contracts. In countries like the US and the Netherlands health insurance is provided by private firms, which can...
Persistent link: https://www.econbiz.de/10008530684
In this paper, the authors study optimal risk adjustment in imperfectly competitive health insurance markets when high-risk consumers are less likely to switch insurer than low-risk consumers.<font face="CMR10" size="3"><font face="CMR10" size="3">First, they find that insurers still have an incentive to select even if risk adjustment perfectly...</font></font>
Persistent link: https://www.econbiz.de/10009151055
The Profit Elasticity (PE) is a new competition measure introduced in Boone (2008). So far, there was no direct proof that this measure can identify regimes of competition empirically. We focus on this issue using data of Genesove and Mullin (1998), in which different regimes of competition...
Persistent link: https://www.econbiz.de/10008836366
This paper compares the welfare effects of three ways in which health care can be organized: no competition (NC), competition for the market (CfM) and competition on the market (CoM) where the payer offers the optimal contract to providers in each case. We show that CfM is optimal if the payer...
Persistent link: https://www.econbiz.de/10011140938