Incentives and Government Relief for Risk

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Louis Kaplow, Incentives and Government Relief for Risk, 4 J. Risk & Uncertainty 167 (1991).Abstract
Government relief is offered for a wide range of risks - - natural disaster, economic dislocation, sickness and injury. This paper explores the effect of such relief on incentives and the allocation of risk in a model with private insurance. It is shown that government relief is inefficient, even when its level is less than the private insurance coverage that individuals would otherwise have purchased and even when private insurance coverage is incomplete due to problems of moral hazard.Other Sources
http://www.nber.org/papers/w3007Terms of Use
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http://nrs.harvard.edu/urn-3:HUL.InstRepos:12207435
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