In this paper, we ask under what conditions norms can enhance welfare by mitigating moral hazard in income insurance … social norms and internalized norms. We study how optimal insurance arrangements, the behavior of insured individuals, and …

Across a wide set of non-group insurance markets, applicants are rejected based on observable, often high …, disability, and life insurance. Consistent with the predictions of the theory, in all three settings I find significant amounts … be rejected relative to those who can purchase insurance; and I show it is enough private information to explain a …