We study the welfare effects of offering choice over coverage levels––“vertical choice”––in regulated health insurance markets. Though the efficient level of coverage, which trades off the value of risk protection and the social cost from moral hazard, likely varies across consumers,...

Objective: To study how changes in insurance benefit design affect medication use of older adults with mental disorders.Data sources: US Medicare claims data from 2007 to 2018.Study Design: We focus on the gradual elimination of the Medicare prescription drug coverage gap beginning in 2011, and...

We consider the Salop (1979) model of product differentiation and assume that consumers are uncertain about the qualities and prices of firms’ products. They can inspect all products at zero cost. A share of consumers is expectation-based loss averse. For these consumers, a purchase plan,...