Diasakos, Theodoros M; Koufopoulos, Kostas - Scottish Institute for Research in Economics (SIRE) - 2013
This paper revisits the problem of adverse selection in the insurance market of Rothschild and Stiglitz [28]. We propose a simple extension of the game-theoretic structure in Hellwig [14] under which Nash-type strategic interaction between the informed customers and the uninformed firms results...