moral hazard adverse selection and health expenditures a semiparametric analysis theoretical models predict asymmetric information in health insurance markets may generate inefficient outcomes due to adverse selection and moral hazard however previous empirical research has found it difficult to disentangle adverse selection from moral hazard in health care consumption we propose a two step semiparametric estimation strategy to identify and estimate a canonical model of asymmetric information in health care markets with this method we can estimate a structural model of demand for health care we illustrate this method using a claims level data set with confidential information from a large self insured employer we find significant evidence of moral hazard and adverse selection

willingness of rural communities to adopt biogas systems in pakistan critical factors and policy implications abstract biogas is a methane rich gas that is produced by the anaerobic fermentation of organic material such as animal dung pakistan has the sixth largest livestock based economy in the world and thus demonstrates great potential for biogas production the government has already started the biogas support program bsp in a few selected areas of the country with that in mind this study was designed to determine a household s predicted willingness to adopt a biogas system in khyber pakhtunkhwa kp province the study is based on primary data collected from four districts peshawar nowshera charsadda and mardan data was collected from 200 livestock farming households selected through an equal allocation technique probit analysis was used to identify those factors influencing the willingness of a household to adopt a biogas system the results of the probit model reveal that the education level of the respondents total daily electric shortfall the effect of electric shortfall on childrens education and female drudgery and respondents awareness regarding the pros and cons of using biogas were statistically significant factors on the basis of p

testing for asymmetric information in insurance markets the first goal of this paper is to provide a simple and general test of the presence of asymmetric information in contractual relationships within a competitive context we also argue that insurance data are particularly well suited to such empirical investigations to illustrate this claim we use data on contracts and accidents to investigate the extent of asymmetric information in the french market for automobile insurance using various parametric and nonparametric methods we find no evidence for the presence of asymmetric information in this market

claim timing and ex post adverse selection many health care treatments are not urgent and may be delayed if patients so choose because insurance coverage is typically determined by the treatment date individuals may have incentives to strategically delay treatments to minimize out of pocket costs the strategic delay of treatment a particular form of moral hazard can be an important source of subsequent adverse selection in which ex ante identical individuals select insurance coverage based on their differing accumulation of previously delayed treatments this article investigates these forces empirically in the context of the missing market for dental insurance using rich claim level data my analysis reveals that approximately 40 of individuals strategically delay dental treatments when incentivized to do so and this flexibility in delaying treatment can explain why the market for dental insurance has largely unraveled more generally the counterfactual analysis suggests features such as open enrolment periods and contracting on pre existing conditions may be helpful tools in overcoming adverse selection in insurance contexts where the timing of uncertainty is not contractible

multidimensional private information market structure and insurance markets we investigate whether selection based on multidimensional private information in risks and risk preferences can under different market structures result in a negative correlation between insurance coverage and ex post realization of risk we show that under perfect competition selection based on multidimensional private information does not result in the negative correlation property unless there is a sufficiently high loading factor however it is possible to generate the negative correlation property under monopoly when risk and risk preference types are sufficiently negative dependent we also clarify the connections between important concepts such as adverse advantageous selection and positive negative correlation property

technology adoption under uncertainty take up and subsequent investment in zambia technology adoption often requires multiple stages of investment as new information emerges agents may abandon a technology that was profitable in expectation we use a field experiment to vary t

learning by doing and the introduction of new goods a dynamic general equilibrium model is developed in which goods are valued according to the characteristics they contain the set of goods produced in any period is endogenously determined and learning by doing is the force behind sustained growth it is shown that the set of produced goods changes in a systematic way over time with goods of higher quality entering each period and those of lower quality dropping out the model is then used to study the effect of introducing a traditional sector in which there is no learning

the great recession and workers health benefits during a recession cost sharing of employer sponsored health benefits could increase to reduce labor costs in the u s using a variation in the severity of recession shocks across industries i find evidence that the enrollment rate of high deductible health plans hdhps among workers covered by employer sponsored health benefits increased more among firms in industries that experienced severe recession shocks as potential mechanisms i study employer side and worker side mechanisms i find that employers changed health benefit offerings to force or incentivize workers to enroll in hdhps but i find little evidence of an increase in workers demand for hdhps due to a reduction in income these results suggest that the hdhp enrollment rate increased during the great recession as employers tried to save costs of offering health benefits

development of method for estimation of world industrial energy consumption and its application abstract the energy balances published by the international energy agency iea are one of the most valuable sources of energy statistics covering world energy supply and demand however some issues arise when these data are analyzed or used directly even when industrial energy consumption alone is examined at least three types of issues are encountered missing data large amounts of misallocated data in some countries and numerous unrealistic outliers in the time series variations when we deal with only a few regions we can look at data one by one and modify them in this case we are going to overcome these issues with a systematic method because the data covers world including more than a hundred regions this paper proposes a data reconciliation method to treat these issues and describes its application to world industrial energy consumption as a result of its application we found that the three issues mentioned above seemed to be overcome the degree of the reconciliation by region showed that oecd countries degree tends to be smaller than those of non oecd countries however not all of the oecd countries have low values and some countries such as the united states have high values

market transparency adverse selection and moral hazard we study the eects of improvements in market transparency on ebay on seller exit and continuing sellers behavior an improvement in market transparency by reducing strategic bias in buyer ratings led to a significant increase in buyer valuation especially of sellers rated poorly prior to the change but not to an increase in seller exit when sellers had the choice between exiting a reduction in adverse selection and improved behavior a reduction in moral hazard they preferred the latter because of lower cost increasing market transparency improves on market outcomes

managerial skills acquisition and the theory of economic development micro level studies suggest managerial skills play a key role in the adoption of modern technologies in this paper we model the interactive process between on the job managerial skill acquisition and the adoption of modern technology we use the model to illustrate why some countries develop managerial skills quickly and adopt best practice technologies while others stay backwards the model also explains why managers will not migrate from rich countries to poor countries as would be needed to generate convergence finally we show why standard growth accounting exercises will incorrectly attribute a large proportion of managerial skills contribution to tfp and we quantify the importance of this bias aq2

the dynamics of electricity demand in pakistan a panel cointegration analysis abstract this paper examines the dynamics of electricity demand in pakistan at the aggregate and sectoral levels over the period 1978 2012 panel cointegration test and fully modified ordinary least squares method is employed to determine the long run relationship between electricity consumption real income real price of electricity and domestic price of non energy products the results reveal that electricity demand is more responsive to changes in income than changes in prices at the aggregate and disaggregate levels short run and long run income elasticities are positive and statistically significant supporting the conservation hypothesis it appears from the results that long run price elasticities are negative and significant at the aggregate level and for the agriculture commercial residential sectors and public utilities the short run price elasticities are significant but low in magnitude which implies that changes in electricity price exert minimal effect on the electricity consumption in pakistan the domestic price of non energy products is positive and significant for aggregate sample in the short run the domestic price of non energy products exert significant negative positive impact on electricity demand in the agriculture industrial sectors the results thus provide important information to the agents operating in the electricity market regarding the income and pricing policies and helps in planning the future strategy of electricity demand management

moral hazard in health insurance what we know and how we know it we describe research on the impact of health insurance on healthcare spending moral hazard and use this context to illustrate the value of and important complementarities between different empirical approaches one common approach is to emphasize a credible research design we review results from two randomized experiments as well as some quasi experimental studies this work has produced compelling evidence that moral hazard in health insurance exists that is individuals on average consume less healthcare when they are required to pay more for it out of pocket as well as qualitative evidence about its nature these studies alone however provide little guidance for forecasting healthcare spending under contracts not directly observed in the data therefore a second and complementary approach is to develop an economic model that can be used out of sample we note that modeling choices can be consequential different economic models may fit the reduced form but deliver different counterfactual predictions an additional role of the more descriptive analyses is therefore to provide guidance regarding model choice

the questionable value of having a choice of levels of health insurance coverage in most health insurance markets in the united states consumers have substantial choice about their health insurance plan however additional choice is not an unmixed blessing as it creates challenges related to both consumer confusion and adverse selection there is mounting evidence that many people have difficulty understanding the value of insurance coverage like evaluating the relative benefits of lower premiums versus lower deductibles also in most us health insurance markets people cannot be charged different prices for insurance based on their individual level of health risk this creates the potential for well known problems of adverse selection because people will often base the level of health insurance coverage they choose partly on their health status in this essay we examine how the forces of consumer confusion and adverse selection interact with each other and with market institutions to affect how valuable it is to have multiple levels of health insurance coverage available in the market

overcoming electricity crisis in pakistan a review of sustainable electricity options abstract pakistan is facing severe electricity supply shortages causing forced power outages over the last decade ranging from 8 to 12 h a day in urban areas and up to 18 h in rural areas the major causes behind the increasing gap between supply and demand are mainly increases in electricity demand on one hand and depleting energy resources and financial constraints on the other in this context the government has been taking various measures including a partial restructuring of the electricity sector under guidelines from international financing institutes at present the country is therefore not only facing a serious challenge of meeting the electricity demand but is also facing the challenge of ensuring energy security in the context of globally important climate change issues the role of policy makers at this stage is crucial for not only assessing and reviewing the current strategies to minimize the electricity supply and demand gap but also the need to develop future strategies ensuring affordable electricity with efficient generation transmission and distribution towards sustainable development in the country this paper provides a review of the current energy situation discussion on policy drivers and plans analysis of the issues of the power sector as well as recommendations for narrowing the electricity supply demand gap towards sustainable electricity for the country

censored quantile instrumental variable estimates of the price elasticity of expenditure on medical care efforts to control medical care costs depend critically on how individuals respond to prices i estimate the price elasticity of expenditure on medical care using a censored quantile instrumental variable cqiv estimator cqiv allows estimates to vary across the conditional expenditure distribution relaxes traditional censored model assumptions and addresses endogeneity with an instrumental variable my instrumental variable strategy uses a family member s injury to induce variation in an individual s own price across the conditional deciles of the expenditure distribution i find elasticities that vary from 0 76 to 1 49 which are an order of magnitude larger than previous estimates

structural innovation and efficiency effects of environmental regulation evidence from china s carbon emissions trading pilot conventional wisdom argues that environmental regulation can trigger both structural adjustments and enhanced innovation we test this conjecture by using a difference in differences approach to analyze the impacts of china s carbon emission trading cet pilot policy on energy consumption we find that compliance with the cet regulation has triggered statistically significant adjustments in energy structure industrial structure and technological innovation adjustments in industrial structure also contribute to enhanced total factor energy efficiency whereas increased technological innovation has mixed effects on energy efficiency we show that in the short run government led innovation does not immediately contribute to improvement in energy efficiency whereas enterprise led innovation has a negative impact it indicates that cet regulation can affect energy efficiency through industrial structure and technological innovation overall our results provide new evidence for the strong version of the porter hypothesis our results also provide strong scientific support for china s recent transition towards market based carbon mitigation strategies

an empirical analysis of competitive nonlinear pricing abstract we estimate a model of competitive nonlinear pricing with multidimensional preference heterogeneity using individual level data on advertisements bought by local businesses e g doctors electricians from two yellow page directories in one u s city market variation in individual choices and payments allows us to identify the joint density of preferences marginal costs of publishing and common utility parameters our estimates suggest substantial welfare loss due to asymmetric information comparing duopoly outcomes with counterfactual monopoly outcomes we find that with less competition i producer surplus increases substantially ii more low type consumers are excluded iii product variety increases but benefits accrue only to the high type consumers iv total consumer surplus decreases v but its distribution across consumers does not change

pricing and welfare in health plan choice premiums in health insurance markets frequently do not reflect individual differences in costs either because consumers have private information or because prices are not risk rated this creates inefficiencies when consumers self select into plans we develop a simple econometric model to study this problem and estimate it using data on small employers we find a welfare loss of 2 11 percent of coverage costs compared to what is feasible with risk rating only about one quarter of this is due to inefficiently chosen uniform contribution levels we also investigate the reclassification risk created by risk rating individual incremental premiums finding only a modest welfare cost

health insurance and the demand for medical care instrumental variable estimates using health insurer claims data this paper takes a different approach to estimating demand for medical care that uses the negotiated prices between insurers and providers as an instrument the instrument is viewed as a textbook cost shifting instrument that impacts plan offerings but is unobserved by consumers the paper finds a price elasticity of demand of around 0 20 matching the elasticity found in the rand health insurance experiment the paper also studies within market variation in demand for prescription drugs and other medical care services and obtains comparable price elasticity estimates

moral hazard in health insurance do dynamic incentives matter using data from employer provided health insurance and medicare part d we investigate whether healthcare utilization responds to the dynamic incentives created by the nonlinear nature of health insurance contracts we exploit the fact that because annual coverage usually resets every january individuals who join a plan later in the year face the same initial spot price of healthcare but a higher expected end of year future price we find a statistically significant response of initial utilization to the future price rejecting the null that individuals respond only to the spot price we discuss implications for analysis of moral hazard in health insurance

a review of energy and power planning and policies of pakistan pakistan is facing multiple challenges for harnessing the indigenous energy resources and devise rational energy policies the country is believed to have abundant energy resources however coping substantial electricity supply gap of over 5000 mw this paper analyses country s energy and power planning studies conducted since its independence in 1947 and policies announced so far it is found that water resources management attained more emphasis in early decades of post independence rather than energy concerns the first energy and power planning study was conducted in late 1960s and since then various studies were undertaken to supplement five yearly medium term development plans of government however it is pertinent to mention that formal energy and power policies were only announced from 1994 onwards owing to growing electricity demand and progressing industrialization beside this the focus of these policies is not only varied but were conceived without undertaking integrated energy planning using energy modeling tools e g markal times leap enpep balance message and energyplan it is despite the fact that these tools are successfully applied globally for devising the energy policies and address the complexities of energy system by assisting effective policy formulation this study recommends that integrated energy planning using energy modeling tools will be helpful to develop sustainable energy policies in pakistan to eradicate electricity crises

the moral hazard effects of consumer responses to targeted cost sharing this paper examines the effects of the reference pricing program implemented by the california public employees retirement system calpers in 2012 the program uses targeted cost sharing to incentivize patient price shopping we find that the program leads to a 10 3 increase in the use of low price providers and reduces the average cost per procedure by 12 5 we further estimate that the program reduces medical spending by 218 8 per procedure which we estimate is approximately 53 7 of the excessive spending that is due to patient choice of higher price providers caused by insurance coverage at the expense of a 94 3 or 12 5 reduction in consumer surplus the cost savings from the reference pricing program is about two to three times as large as the reduction from implementing a high deductible health plan while the accompanying consumer surplus reduction is much smaller under reference pricing

estimating the tradeoff between risk protection and moral hazard with a nonlinear budget set model of health insurance insurance induces a tradeoff between the welfare gains from risk protection and the welfare losses from moral hazard empirical work traditionally estimates each side of the tradeoff separately potentially yielding mutually inconsistent results i develop a nonlinear budget set model of health insurance that allows for both simultaneously nonlinearities in the budget set arise from deductibles coinsurance rates and stoplosses that alter moral hazard as well as risk protection i illustrate the properties of my model by estimating it using data on employer sponsored health insurance from a large firm

equilibria in health exchanges adverse selection versus reclassification risk this paper studies equilibrium and welfare in a class of regulated health insurance markets known as exchanges we use detailed health plan choice and utilization data to model individual level i projected health risk and ii risk preferences we combine the estimated distributions of risk and risk preferences with a model of competitive insurance markets to predict allocations and prices

multiple dimensions of private information evidence from the long term care insurance market we demonstrate the existence of multiple dimensions of private information in the long term care insurance market two types of people purchase insurance individuals with private information that they are high risk and individuals with private information that they have strong taste for insurance ex post the former are higher risk than insurance companies expect while the latter are lower risk in aggregate those with more insurance are not higher risk our results demonstrate that insurance markets may suffer from asymmetric information even absent a positive correlation between insurance coverage and risk occurrence the results also suggest a general test for asymmetric information

a structural model of multiple welfare program participation and labor supply work on estimating the labor supply effects of high marginal tax rates in welfare programs has been hindered by the difficulty of estimating the effects of participation in multiple welfare programs simultaneously the authors solve this problem by applying methods of simulation estimation to a model of labor supply and multiple program participation the results show asymmetric wage and tax rate effects with fairly large wage elasticities of labor supply but very inelastic responses to moderate changes in cumulative marginal tax rates implying that high welfare tax rates do not necessarily induce major reductions in work effort copyright 1998 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

demand elasticities and service selection incentives among competing private health plans we examine selection incentives by health plans while refining the selection index of mcguire et al 2014 to reflect not only service predictability and predictiveness but also variation in cost sharing risk adjusted profits profit margins and newly refined demand elasticities across 26 disaggregated types of service we contrast selection incentives measured by service selection elasticities across six plan types using privately insured claims data from 73 large employers from 2008 to 2014 compared to flat capitation concurrent risk adjustment reduces the elasticity by 47 prospective risk adjustment by 43 simple reinsurance system by 32 and combined concurrent risk adjustment with reinsurance by 60 reinsurance significantly reduces the variability of individual level profits but increases the correlation of expected spending with profits which strengthens selection incentives

vintage human capital growth and the diffusion of new technology we develop a model of vintage human capital in which each technology requires vintage specific skills we examine the properties of a stationary equilibrium for our economy the stationary equilibrium is characterized by an endogenous distribution of skilled workers across vintages the distribution is shown to be single peaked under general conditions there is a lag between the appearance of a technology and its peak usage a phenomenon known as diffusion an increase in the rate of exogenous technological change shifts the distribution of human capital to more recent vintages thereby increasing the diffusion rate

what does a deductible do the impact of cost sharing on health care prices quantities and spending dynamics measuring consumer responsiveness to medical care prices is a central issue in health economics and a key ingredient in the optimal design and regulation of health insurance markets we study consumer responsiveness to medical care prices leveraging a natural experiment that occurred at a large self insured firm which required all of its employees to switch from an insurance plan that provided free health care to a non linear high deductible plan the switch caused a spending reduction between 11 79 13 80 of total firm wide health spending we decompose this spending reduction into the components of i consumer price shopping ii quantity reductions and iii quantity substitutions finding that spending reductions are entirely due to outright reductions in quantity we find no evidence of consumers learning to price shop after two years in high deductible coverage consumers reduce quantities across the spectrum of health care services including potentially valuable care e g preventive services and potentially wasteful care e g imaging services we then leverage the unique data environment to study how consumers respond to the complex structure of the high deductible contract we find that consumers respond heavily to spot prices at the time of care and reduce their spending by 42 when under the deductible conditional on their true expected end of year shadow price and their prior year end of year marginal price in the first year post plan change 90 of all spending reductions occur in months that consumers began under the deductible with 49 of all reductions coming for the ex ante sickest half of consumers under the deductible despite the fact that these consumers have quite low shadow prices there is no evidence of learning to respond to the true shadow price in the second year post switch

global observation of ekc hypothesis for co2 sox and nox emission a policy understanding for climate change mitigation in bangladesh abstract environmental kuznets curve ekc hypothesis is critical to understanding the developmental path of a nation in relation to its environment how the effects of economic development processes dictate environmental changes can be found through the study of ekc to understand the ekc phenomena for climate change this study was undertaken by reviewing the available literature as co2 sox and nox are the significant greenhouse gases ghg responsible for global warming thus leading to climate change the study focused on those ghgs for ekc consideration with an understanding of the different ekc trajectories an attempt was made to determine the implications for the economic development of bangladesh in regards to the ekc it was shown that ekc for co2 was following a monotonous straight line in most cases sox were shown to follow the full trajectory of the ekc in most situations and nox was shown the hope only for the developed countries getting the low income turning point the type of economic policy that bangladesh should follow in regards to the discussed pollutants and sources is also revealed from these discussions contributions to policy stimulation in bangladesh are likely to be made

insurance induced moral hazard a dynamic model of within year medical care decision making under uncertainty health insurance may lead individuals to overconsume medical care many studies explore this moral hazard using models that aggregate medical care decisions up to the annual level using employer employee matched data from the medical expenditure panel survey meps i estimate moral hazard using a dynamic model of within year medical care consumption that allows for endogenous health transitions variation in medical care prices and individual uncertainty within a health insurance year i then estimate moral hazard under a second set of conditions that are consistent with the assumptions of most annual decision making models the within year decision making model produces a moral hazard estimate that is 19 2 larger than the alternative model i highlight the importance of controlling for within year dynamics in a model of medical care consumption using a counterfactual policy simulation that implements the individual mandate provision of the 2010 patient protection and aordable care act i nd that full implementation of the policy decreases the percentage of uninsured individuals in the population being analyzed from 11 8 to 6 0 furthermore when all uninsured individuals are forced into coverage their predicted annual medical care expenditure increases by 45 5

the industrial organization of health care markets the u s health care sector is large and growing health care spending in 2011 amounted to 2 7 trillion and 18 percent of gdp approximately half of health care output is allocated via markets in this paper we analyze the industrial organization literature on health care markets focusing on the impact of competition on price quality and treatment decisions for health care providers and health insurers we conclude with a discussion of research opportunities for industrial organization economists including opportunities created by the u s patient protection and affordable care act

experimental identification of asymmetric information evidence on crop insurance in the philippines abstract i study asymmetric information in crop insurance in the philippines using a two level randomized field experiment and incentivized preference elicitation in this first experimental study of moral hazard in non health insurance preventable damages double on randomly insured plots among farmers with high trust in the insurance provider farmers prefer insurance on plots that are at risk of floods and crop diseases a sign of classic adverse selection and plots that are far away from home a sign of selection on anticipated moral hazard behavior resulting in 72 higher payouts on preferred plots overcoming these challenges requires leveraging new technologies

china s energy consumption under the global economic crisis decomposition and sectoral analysis abstract it is now widely recognized that there is a strong relationship between energy consumption and economic growth most countries energy demands declined during the economic depression of 2008 2009 when a worldwide economic crisis occurred as an export oriented economy china suffered a serious exports decline in the course of the crisis however it was found that energy consumption continued to increase against such a background this paper aims to assess and explain the factors causing the growth of energy consumption in china first we will explain the impact of domestic final use and international trade on energy consumption by using decomposition analysis second embodied energy and its variation across sectors are quantified to identify the key sectors contributing to the growth lastly the policy implications for long term energy conservation are discussed the results show that the decline in exports was one of the driving forces for energy consumption reduction in the crisis but that the growth of domestic demand in manufacturing and construction largely stimulated by economic stimulus plans had the opposite effect on energy consumption international trade contributed to decreasing energy consumption of china during and after the crisis because the structure of exports and imports changed in this period

health insurance and the demand for medical care evidence from a randomized experiment we estimate how cost sharing the portion of the bill the patient pays affects the demand for medical services the data come from a randomized experiment a catastrophic insurance plan reduces expenditures 31 percent relative to zero out of pocket price the price elasticity is approximately 0 2 we reject the hypothesis that less favorable coverage of outpatient services increases total expenditure for example by deterring preventive care or inducing hospitalization

an institutional framework for the development of sustainable and competitive power market in pakistan abstract pakistan is continuously striving for sustainable and competitive power market under the comprehensive power sector reform program pakistan shifted its power market from monopoly model to single buyer model by unbundling water and power development authority wapda and establishing national transmission and dispatch company ntdc current severe power situation in the country is triggering the government of pakistan gop to accelerate the implementation of intended reform program and to readily undertake next planned transformation i e from single buyer model to wholesale market model this research endeavors the future dynamics of power market after the structural spin off by pre assessment of upcoming wholesale power market market power of both public and private electricity generators has been computed using 8 largest firm concentration ratio herfindahl hirschman index hhi and residual supply index rsi the findings suggest that future power market will function with non existence of market power except in the periods of peak electricity demand and maximum hydro generation furthermore insufficient installed capacities and underutilization of public thermal units may enable some players to exercise market power for sustainable and competitive power market an empirically supported framework has been proposed based on the analysis the framework proposes utilization of huge available renewable energy potential for future which will protect the whole infrastructure from market power it recommends respective roles and responsibilities for the smooth transition among market models the framework will be supportive in terms of successful and smooth transition from single buyer model to wholesale market model and potential of wind solar biogas to be properly explored and utilized to reduce energy gap

estimating demand elasticities using nonlinear pricing abstract nonlinear pricing is prevalent in industries such as health care public utilities and telecommunications however this pricing scheme introduces bias into estimating elasticities for welfare analysis or policy changes i develop a local elasticity estimation method that uses nonlinear price schedules to isolate consumers expenditure choices from selection and simultaneity biases this method improves over previous approaches by using commonly available observational data and requiring only a single general monotonicity assumption using claims level data on health insurance with two nonlinearities i am able to measure two separate elasticities and find that elasticity declines from 0 26 to 0 09 by the second nonlinearity these estimates are then used to calculate moral hazard deadweight loss this method enables estimation of many policies with nonlinear pricing which previous tools could not address

an overview of energy consumption of the globalized world economy abstract for the globalized world economy with intensive international trade an overview of energy consumption is presented by an embodied energy analysis to track both direct and indirect energy uses based on a systems input output simulation in 2004 the total amounts of energy embodied in household consumption government consumption and investment are 7749 874 and 2009 mtoe million tons of oil equivalent respectively the united states is shown as the world s biggest embodied energy importer 683 mtoe and embodied energy surplus receiver 290 mtoe in contrast to china as the biggest exporter 662 mtoe and deficit receiver 274 mtoe energy embodied in consumption per capita varies from 0 05 uganda to 19 54 toe rest of north america based on a forecast for 2005 2035 china is to replace the united states as the world s leading embodied energy consumer in 2027 when its per capita energy consumption will be one quarter of that of the united states

estimating marginal returns to education this paper estimates marginal returns to college for individuals induced to enroll in college by different marginal policy changes the recent instrumental variables literature seeks to estimate this parameter but in general it does so only under strong assumptions that are tested and found wanting we show how to utilize economic theory and local instrumental variables estimators to estimate the effect of marginal policy changes our empirical analysis shows that returns are higher for individuals with values of unobservables that make them more likely to attend college we contrast our estimates with iv estimates of the return to schooling

second degree moral hazard in a real world credence goods market in a field experiment in the market for taxi rides we investigate a phenomenon called second degree moral hazard the tendency of the supply side in a market to react to anticipated moral hazard on the demand side by increasing the extent or price of the service our moral hazard manipulation consists of some passengers explicitly stating that their expenses will be reimbursed this has a strong positive effect on the likelihood and the amount of overcharging and consequently increases consumer expenditure our results suggest that second degree moral hazard may have a severe impact on the provision of credence goods

global estimates of energy consumption and greenhouse gas emissions abstract the present study examines the long run relationship between energy consumption and greenhouse gas emission for different groups of countries comprising lower middle income upper middle income and heavily indebted countries east asia and pacific east europe and central asia latin america and caribbean middle east and north africa south asia sub saharan africa and for aggregate data of the world the data has been analyzed by using various econometric techniques specifically the johnson cointegration modified version of granger causality and variance decomposition analysis from the period of 1975 to 2011 the results confirm that there is a long run relationship between greenhouse gas emissions i e agricultural methane emission agricultural nitrous oxide emission and carbon dioxide emission and energy consumption the results of granger causality indicate that energy consumption granger causes greenhouse gas emission but not vice versa the important finding is that energy consumption granger causes gdp per unit energy use which confirms the energy led growth hypothesis in the world however the vice versa relationship does not hold the results imply that a policy to cut energy consumption tends to diminish greenhouse gas emission though affecting gdp of countries negatively

health insurance for humans information frictions plan choice and consumer welfare traditional models of insurance choice are predicated on fully informed and rational consumers protecting themselves from exposure to financial risk in practice choosing an insurance plan is a complicated decision often made without full information in this paper we combine new administrative data on health plan choices and claims with unique survey data on consumer information to identify risk preferences information frictions and hassle costs our additional friction measures are important predictors of choices and meaningfully impact risk preference estimates we study the implications of counterfactual insurance allocations to illustrate the importance of distinguishing between these micro foundations for welfare analysis

bunching at the kink implications for spending responses to health insurance contracts abstract a large literature in empirical public finance relies on bunching to identify a behavioral response to non linear incentives and to translate this response into an economic object to be used counterfactually we conduct this type of analysis in the context of prescription drug insurance for the elderly in medicare part d where a kink in the individual s budget set generates substantial bunching in annual drug expenditure around the famous donut hole we show that different alternative economic models can match the basic bunching pattern but have very different quantitative implications for the counterfactual spending response to alternative insurance contracts these findings illustrate the importance of modeling choices in mapping a compelling reduced form pattern into an economic object of interest

selection on moral hazard in health insurance economic analysis of market failure in insurance markets tends to analyze selection and moral hazard as distinct phenomena in this paper we explore the potential for selection on moral hazard in insurance markets by this we mean the possibility that moral hazard effects are heterogenous across individuals and that individuals selection of insurance coverage is affected by their anticipated behavioral response to coverage we examine these issues empirically in the context of employer provided health insurance in the united states specifically we break down the general

the demand for episodes of treatment in the health insurance experiment abstract this paper analyzes claims data from the rand health insurance experiment which were grouped into episodes of treatment the insurance plans in the experiment have coinsurance and a cap on out of pocket spending using new statistical techniques to adjust for the increased sickliness of those who exceed the cap the effects of coinsurance on cost per episode and number of episodes are estimated cost sharing reduced the number of episodes but had little effect on cost per episode people in the experiment responded myopically as their current insurance status changed through the year the price elasticity of spending was about 0 2 throughout the range of coinsurance studied when data permit it the study of episodes complements analyses of annual medical spending by revealing more about how decisions to spend are made within the year

health care demand elasticities by type of service we estimate within year price elasticities of demand for detailed health care services using an instrumental variable strategy in which individual monthly cost shares are instrumented by employer year plan month average cost shares a specification using backward myopic prices gives more plausible and stable results than using forward myopic prices using 171 million person months spanning 73 employers from 2008 to 2014 we estimate that the overall demand elasticity by backward myopic consumers is 0 44 with higher elasticities of demand for pharmaceuticals 0 44 specialists visits 0 32 mris 0 29 and mental health substance abuse 0 26 and lower elasticities for prevention visits 0 02 and emergency rooms 0 04 demand response is lower for children in larger firms among hourly waged employees and for sicker people overall the method appears promising for estimating elasticities for highly disaggregated services although the approach does not work well on services that are very expensive or persistent

estimating welfare in insurance markets using variation in prices we provide a graphical illustration of how standard consumer and producer theory can be used to quantify the welfare loss associated with inefficient pricing in insurance markets with selection we then show how this welfare loss can be estimated empirically using identifying variation in the price of insurance such variation together with quantity data allows us to estimate the demand for insurance the same variation together with cost data allows us to estimate how insurers costs vary as market participants endogenously respond to price the slope of this estimated cost curve provides a direct test for both the existence and the nature of selection and the combination of demand and cost curves can be used to estimate welfare we illustrate our approach by applying it to data on employerprovided health insurance from one specific company we detect adverse selection but estimate that the quantitative welfare implications associated with inefficient pricing in our particular application are small in both absolute and relative terms

choice inconsistencies among the elderly evidence from plan choice in the medicare part d program comment consumers enrollment decisions in medicare part d can be explained by abaluck and gruber s 2011 model of utility maximization with psychological biases or by a neoclassical version of their model that precludes such biases we evaluate these competing hypotheses by applying nonparametric tests of utility maximization and model validation tests to administrative data we find that 79 percent of enrollment decisions from 2006 to 2010 satisfied basic axioms of consumer theory under the assumption of full information the validation tests provide evidence against widespread psychological biases in particular we find that precluding psychological biases improves the structural model s out of sample predictions for consumer behavior

medicaid insurance in old age the old age provisions of the medicaid program were designed to insure retirees against medical expenses we estimate a structural model of savings and medical spending and use it to compute the distribution of lifetime medicaid transfers and medicaid valuations across currently single retirees compensating variation calculations indicate that current retirees value medicaid insurance at more than its actuarial cost but that most would value an expansion of the current medicaid program at less than its cost these findings suggest that for current single retirees the medicaid program may be of the approximately right size

assessment of present conventional and non conventional energy scenario of pakistan abstract it has become the universal fact that the energy is one of the key factors for the smooth and faster upgradation of the socio economic activities in any country in pakistan s history of over 60 years the country presently is facing possibly the worst energy crisis that has geared back the socio economic development below the level of critical sustainability and tolerance of the people every walk of life and industrial activities have declined due to long electricity shut down every day since last few years in view to access the current status of available energy resources the present research study has been carried out to review and assess the demography of the country versus energy sectors energy supplies consumptions status of fossil fuel resources oil gas coal conventional non conventional electricity generation and past present future energy demand supply during 2001 2011 the results of this assessment indicate that conventional resources in pakistan are and will not be enough to meet the ever growing energy demand and consequently highlight the importance of the renewable energy sources that are apparently encouraging in the country but have not been developed to any satisfaction priority is imperative to be given for the adequate development of renewable energy sectors in addition to the present energy mix

national energy scenario of pakistan current status future alternatives and institutional infrastructure an overview abstract in this article the current energy consumption of pakistan is presented and the issue of security of electrical energy supply is discussed the power sector has been looked from variety of aspects such as demand and supply gap diminishing energy sources energy security and increasing energy costs furthermore the status of energy and potential of renewable sources of energy has been discussed as sustainable alternative in addition the roles of different sectors in the promotion and development of renewable energy technologies have been discussed the renewable energy future prospects are encouraging in pakistan with a total renewable energy potential of about 167 7 gw which is more than enough to meet the total electricity demand of the country this vast potential of renewable sources of energy could be utilized to overcome the energy shortage which has not been utilized properly due to lack of policies and infrastructure the diversification of existing energy resources and exploration of new sources is an important aspect to be considered in order to have a sustainable power development and its implementation in the country

perfect competition in markets with adverse selection this paper proposes a perfectly competitive model of a market with adverse selection prices are determined by zero profit conditions and the set of traded contracts is determined by free entry crucially for applications contract characteristics are endogenously determined consumers may have multiple dimensions of private information and an equilibrium always exists equilibrium corresponds to the limit of a differentiated products bertrand game we apply the model to establish theoretical results on the equilibrium effects of mandates mandates can increase efficiency but have unintended consequences with adverse selection an insurance mandate reduces the price of low coverage policies which necessarily has indirect effects such as increasing adverse selection on the intensive margin and causing some consumers to purchase less coverage

small firms bigger changes health insurance coverage take up rates in small firms after the aca measuring the impact of the affordable care act of 2010 aca on employer sponsored health insurance is essential in an era of constant changes to health policy using data from the kaiser family f

structure and environmental impact of global energy consumption abstract this paper presents information on global energy consumption by fuel type liquid fuels coal natural gas renewables and nuclear and sectors buildings industrial transportation and electricity and environmental impact of global energy consumption sox nox and co2 emissions there is a strong relationship between energy consumption and economic growth the global financial crisis has affected the global economic growth violently the governments have recently adopted some effective measures to fight against the global financial crisis the structure of energy consumption and the conditions of sox nox and co2 emissions affect the global changes acid rain and greenhouse effect today considerable effort is being devoted to reduce co2 emissions because of the kyoto protocol on climate change this publication presents multidisciplinary perspectives on the interrelated topics of energy consumption energy security and energy policy additionally the present study examines the relationship between energy consumption and greenhouse gas emission

the effects of access to health insurance evidence from a regression discontinuity design in peru in many countries large parts of the population do not have access to health insurance peru has made an effort to change this in the early 2000s the institutional setup gives rise to the rare opportunity to study the effects of health insurance coverage exploiting a sharp regression discontinuity design we find large effects on utilization that are most pronounced for the provision of curative care individuals seeing a doctor leads to increased awareness about health problems and generates a potentially desirable form of supplier induced demand they decide to pay themselves for services that are in short supply

the labor market and corporate structure abstract we analyze the impact of labor demand and labor market regulations on the corporate structure of firms higher wages are associated with lower monitoring irrespective of whether these high wages are caused by labor market regulations unions or higher labor demand we also find that the organization of firms has important macroeconomic implications in particular monitoring is a type of rent seeking activity and the decentralized equilibrium spends excessive resources on monitoring labor market regulations that reduce monitoring by pushing wages up may increase net output or reduce it only by a small amount even though they reduce employment

optimal mandates and the welfare cost of asymmetric information evidence from the u k annuity market much of the extensive empirical literature on insurance markets has focused on whether adverse selection can be detected once detected however there has been little attempt to quantify its welfare cost or to assess whether and what potential government interventions may reduce these costs to do so we develop a model of annuity contract choice and estimate it using data from the u k annuity market the model allows for private information about mortality risk as well as heterogeneity in preferences over different contract options we focus on the choice of length of guarantee among individuals who are required to buy annuities the results suggest that asymmetric information along the guarantee margin reduces welfare relative to a first best symmetric information benchmark by about 127 million per year or about 2 percent of annuitized wealth we also find that by requiring that individuals choose the longest guarantee period allowed mandates could achieve the first best allocation however we estimate that other mandated guarantee lengths would have detrimental effects on welfare since determining the optimal mandate is empirically difficult our findings suggest that achieving welfare gains through mandatory social insurance may be harder in practice than simple theory may suggest

choosing the wrong calling plan ignorance and learning when a firm offers several tariff options to its customers the possibility arises that they will make an ex post mistake in tariff choice this occurs since consumers cannot commit to a certain purchase level at the time they subscribe to the service option and thus they might find out later that a different choice of tariff could have resulted in a lower payment for their actual level of consumption this is a common feature of increasingly important subscriptions markets in which buyers and sellers maintain long term nonanonymous relations and where learning induces interesting dynamics on the one hand buyers may learn their taste over time thus making the right choice as times goes by on the other hand the seller may design options to identify the type of each buyer and if possible to extract a higher proportion of their consumer surplus by offering tariff options that are better tailored to the profile of the consumer this paper focuses on the first type of learning in turn i document buyer behavior in a subscriptions market using data from a tariff experiment run by south central bell scb in kentucky during the second half of 1986 the most frequently studied case of subscriptions markets is the choice among optional calling plans ocps in the telephone industry this paper shows that contrary to the conven

renewable energy consumption and economic growth evidence from a panel of oecd countries abstract this study examines the relationship between renewable energy consumption and economic growth for a panel of twenty oecd countries over the period 1985 2005 within a multivariate framework given the relatively short span of the time series data a panel cointegration and error correction model is employed to infer the causal relationship the heterogeneous panel cointegration test reveals a long run equilibrium relationship between real gdp renewable energy consumption real gross fixed capital formation and the labor force with the respective coefficients positive and statistically significant the granger causality results indicate bidirectional causality between renewable energy consumption and economic growth in both the short and long run

economic growth urbanization and energy consumption a provincial level analysis of china abstract as the largest developing country with fast paced economic growth china s development has been characterized by a high degree of energy consumption high level of heavy industry international trade and urbanization progress in this study we extend the current literature by incorporating urbanization energy consumption and international trade into a production function using a panel data set model over the period from 2001 to 2012 the results show that urbanization and capital are the major contributors to china s economic growth meanwhile there exists a u shaped relationship between urbanization and economic growth that heavy industry exerts a significant negative effect on economic growth using system generalized methods of moments gmm sys estimation methods and the relationship between international trade and economic growth is mixed and no consistent results support the conclusion that the international trade promotes economic growth adjusting the industry and trade structure in economic growth is the priority for the policy makers

why do hmos spend less patient selection physician price sensitivity and prices abstract cost control incentives have become an important part of the health insurance landscape in the united states these incentives are the strongest in capitated managed care organizations especially hmos because such organizations are paid a fixed amount regardless of the spending they generate using a sample of insurance claims from about 500 plans i find that in hmos spending on anti cholesterol drugs is 19 lower than in other insurance plans this spending difference could reflect the strong cost control incentives generated by capitation but it could also reflect the selection of healthy price sensitive patients into hmos or it could simply reflect lower prices to understand the difference i estimate a model of physician prescribing and patient refill decisions patients in hmos are nearly twice as sensitive to copays as are other patients consistent with selection of healthy patients into hmos even after adjusting for this selection however hmo physicians remain highly sensitive to drug procurement costs this high sensitivity explains about a 20 of the spending difference combined with lower prices it explains about 25 55 of the difference i find no evidence that these spending reductions result in fewer patient refills or the prescribing of less effective statins

socio economic determinants of energy consumption an empirical survey for greece abstract the present study identifies and evaluates the macroeconomic factors that determine energy consumption in greece this study is based on annual time series data covering the period ranging from 1975 2013 the augmented dickey fuller adf test and kpss test are employed in order to test stationarity of the data confirming that all the variables are i 1 within the next step of the methodology we employed a vecm model in order to detect causality among the variables through the granger causality test similarly the impulse response analysis provides that urbanization infrastructure trade income population growth and foreign direct investment are the main determinants of energy consumption in greece during the period surveyed the findings suggest that in order to fulfill the energy demand in the country the decision makers need to formulate energy policy in favor of enlarging the supply of energy and especially renewable energy to foster the process of economic growth and development especially in the times of crisis the particular determinants are a necessity to initiate economic growth

patient cost sharing and hospitalization offsets in the elderly in the medicare program increases in cost sharing by a supplemental insurer can exert financial externalities we study a policy change that raised patient cost sharing for the supplemental insurer for retired public employees in california we find that physician visits and prescription drug usage have elasticities that are similar to those of the rand health insurance experiment hie unlike the hie however we find substantial offset effects in terms of increased hospital utilization the savings from increased cost sharing accrue mostly to the supplemental insurer while the costs of increased hospitalization accrue mostly to medicare

adverse selection and inertia in health insurance markets when nudging hurts this paper investigates consumer inertia in health insurance markets where adverse selection is a potential concern we leverage a major change to insurance provision that occurred at a large firm to identify substantial inertia and develop and estimate a choice model that also quantifies risk preferences and ex ante health risk we use these estimates to study the impact of policies that nudge consumers toward better decisions by reducing inertia when aggregated these improved individual level choices substantially exacerbate adverse selection in our setting leading to an overall reduction in welfare that doubles the existing welfare loss from adverse selection jel d82 g22 i13 a number of potential impediments stand in the way of efficient health insur ance markets the most noted of these is adverse selection first studied by akerlof 1970 and rothschild and stiglitz 1976 in insurance markets prices reflect the expected risk costs of the insured pool whether the reason is price regulation or private information when insurers cannot price all risk characteristics riskier consumers choose more comprehensive health plans this causes the equilibrium prices of these plans to rise and healthier enrollees to select less comprehensive coverage than they would otherwise prefer

estimating risk preferences from deductible choice we develop a structural econometric model to estimate risk preferences from data on deductible choices in auto insurance contracts we account for adverse selection by modeling unobserved heterogeneity in both risk claim rate and risk aversion we find large and skewed heterogeneity in risk attitudes in addition women are more risk averse than men risk aversion exhibits a u shape with respect to age and proxies for income and wealth are positively associated with absolute risk aversion finally unobserved heterogeneity in risk aversion is greater than that of risk and as we illustrate has important implications for insurance pricing

reprint of bunching at the kink implications for spending responses to health insurance contracts abstract a large literature in empirical public finance relies on bunching to identify a behavioral response to non linear incentives and to translate this response into an economic object to be used counterfactually we conduct this type of analysis in the context of prescription drug insurance for the elderly in medicare part d where a kink in the individual s budget set generates substantial bunching in annual drug expenditure around the famous donut hole we show that different alternative economic models can match the basic bunching pattern but have very different quantitative implications for the counterfactual spending response to alternative insurance contracts these findings illustrate the importance of modeling choices in mapping a compelling reduced form pattern into an economic object of interest

constrained efficient equilibria in selection markets with continuous types abstract we prove the existence of the constrained efficient miyazaki 1977 wilson 1977 spence 1978 equilibrium in competitive markets with adverse selection when the distribution of unobservable types is continuous our existence proof applies under extremely general assumptions about individual preferences when we restrict preferences to have the widely used in the selection markets literature quasilinear form we characterize the properties of this equilibrium by developing a simple and computationally efficient numerical method for constructing it applying this method we show in a natural setting how one would compute the equilibrium allocation potentially facilitating empirical work using the mws equilibrium we illustrate this empirical application in the context of policy interventions and show that the welfare implications of a coverage mandate critically hinge on whether the market implements a constrained efficient allocation like the mws equilibrium or a constrained inefficient allocation like in azevedo and gottlieb 2017

factors determining energy consumption evidence from indonesia malaysia and thailand abstract the aim of this study is to verify empirically the impact of various factors on energy consumption in three asean countries namely indonesia malaysia and thailand over the period 1980 to 2012 after using sundry appropriate diagnostic tests for checking time series data the method of least square as an analytical technique is used for parameters estimation the findings validate that fdi inflows economic growth trade openness and human development index have positive and statistically significant impacts on energy consumption the other variable urbanization has positive and statistically significant impacts on energy consumption for thailand and indonesia only while the empirical results reveals that population growth rate has a positive and statistically significant relationship with energy consumption only in the case of malaysia so in the light of determinations of the study the policy implication is that energy policy needs to be orientated in favor of expanding the supply of energy to reach an enhanced degree of sustainable economic growth and development

brain drain or brain gain technology diffusion and learning on the job this paper studies technology transfer when technology is embodied in human capital and learning requires on the job communication between managers and workers patterns of technology diffusion depend on where high knowledge managers work and how much time they allocate to training workers managers appropriate the surplus training creates and in the open economy managers face a cross country trade off between labor costs and the value of knowledge transfer complementarity between country level efficiency and managerial knowledge makes learning more valuable in the north meaning that high knowledge managers choose to work in the north and globalization precipitates a brain drain of high knowledge southern agents to the north the brain drain reduces learning opportunities in the south and exacerbates cross country technology differences

tariff choice with consumer learning and switching costs abstract consumers choosing flat rate contracts tend to have insufficient usage to warrant the cost particularly for new products we propose and estimate a bayesian learning model of tariff and usage choice that explains this flat rate bias without relying on behavioral misjudgments or tariff specific preferences for new products consumers are uncertain about both their utility relative to the population mean and the mean itself we show that this latter uncertainty inflates prior variances which leads consumers to weight their private signals more heavily when updating beliefs posteriors are unbiased across products for a given product however the unknown mean yields a winner s curse consumers with high posteriors tend to overestimate their utility these consumers choose fixed rate tariffs and lower their usage as they correct their beliefs the flat rate bias arises when switching costs deter them from changing tariffs using the estimated model the authors find that tariff menus are ineff