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Expanding access to financial services holds the promise to help reduce poverty and spur economic development. But, as a practical matter, commercial banks have faced challenges expanding access to poor and low-income households in developing economies, and nonprofits have had limited reach. We...
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certain. (3) Buy inadequate insurance for very low probability events. (4) Keeping the expected loss fixed, there is a … probability below which the take-up of insurance drops dramatically. Expected utility (EU) fails on 1-4. Existing models of rank …. -- Decision making under risk ; Insurance ; Composite Prelec probability weighting functions ; Composite rank dependent utility …
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Persistently high profits on “insurance” for small value losses sold as an add-on to other products or services (such … insurance sold with a loan) pose a twofold challenge to the standard economic analysis of insurance. First, expected utility … theory teaches that people should not buy insurance for small value losses. Second, the market should not in the long run …
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