Genetic Tests and Intertemporal Screening in Competitive Insurance Markets

Winand Emons

No 6047, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We consider successive generations of non-altruistic individuals carrying a good or bad gene. Daughters are more likely to carry their mother's gene than the opposite one. Competitive insurers can perform a genetic test revealing an agent's gene. They may condition their quotes on the agent's or on her ancestors' genetic status. In equilibrium generation one is bribed to take the test with an unconditional quote. The insurer uses this information to profitably screen a finite number of generations of their offspring. The offspring of good gene carriers subsidize the tested generation.

Keywords: Genetic tests; Insurance; Pooling; Screening (search for similar items in EconPapers)
JEL-codes: D82 G22 (search for similar items in EconPapers)
Date: 2007-01
New Economics Papers: this item is included in nep-ias
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Related works:
Journal Article: Genetic Tests and Inter-Temporal Screening in Competitive Insurance Markets (2009)
Working Paper: Genetic Tests and Intertemporal Screening in Competitive Insurance Markets (2006)
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