Uncertainty of Governmental Relief and the Crowding out of Insurance
Paul Raschky (),
Manijeh Schwindt and
No 05-10, Monash Economics Working Papers from Monash University, Department of Economics
This paper discusses the problem of crowding out of insurance by co-existing governmental relief programs - so-called â€™charity hazardâ€™ - in a context of different institutional schemes of government relief in Austria and Germany. We test empirically whether an assured partial relief scheme (as in Austria) drives a stronger crowding out of private insurance than a scheme promising full relief which is subject to ad hoc political decision making (as in Germany). Our general finding is that the institutional design of governmental relief programs significantly affects the demand for private natural hazard insurance.
Keywords: Insurance demand; governmental relief; natural hazards (search for similar items in EconPapers)
JEL-codes: D78 D81 G22 Q54 (search for similar items in EconPapers)
Pages: 29 pages
New Economics Papers: this item is included in nep-ias
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Working Paper: Uncertainty of Governmental Relief and the Crowding out of Insurance
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