Title

Insurance Market Games: Scale Effects and Public Policy

Document Type

Discussion Paper

Publication Date

8-1-1994

CFDP Number

1076

CFDP Pages

26

Abstract

We propose a game-theoretic model to study various effects of scale in an insurance market. After reviewing a simple static model, we present a one-period game in which both the buyers and sellers of insurance make strategic bids, and show that, under reasonably broad conditions, market equilibrium exists. For a special case, we then consider how both the price and quantity of insurance, as well as other quantities of interest to public policy decision makers, are affected by the number of insurance firms, the number of customers, and the total amount of capital provided by investors.

This document is currently not available here.

Share

COinS