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Handbook of the Economics of Risk and Uncertainty
book

Handbook of the Economics of Risk and Uncertainty

by Mark Machina, W. Kip Viscusi
November 2013
Beginner content levelBeginner
896 pages
35h 10m
English
North Holland
Content preview from Handbook of the Economics of Risk and Uncertainty
Insurance and Insurance Markets
237
(i.e., failing to constrain some inadequately capitalized insurers and inefficiently distort-
ing the decisions of some adequately capitalized insurers). His model predicts that cost
minimizing capital standards will be less stringent the greater is the proportion of insur-
ers that would be adequately capitalized without regulation. An implication is that
optimal capital standards should not bind most insurers in a market characterized by
strong market discipline. He therefore argues that the U.S. RBC system, where most
insurers hold significantly more capital that the required minimums (Harrington, 2004a;
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Publisher Resources

ISBN: 9780444536853