ECON 345 - Risk and Insurance

FC NSMA QFR

4 credits
Uncertainty is pervasive in everyday life. This course develops the economic theory of decision-making under risk, with emphasis on insurance markets and the problems created by asymmetric information. Topics include expected utility theory, measures of risk aversion, optimal insurance, adverse selection, moral hazard, and the value of information. Throughout, we draw on empirical studies of insurance markets to evaluate how well theory explains observed behavior.

Prerequisites: ECON 253.