Structural estimation of a principal-agent model: moral hazard in medical insurance.
Despite the importance of principal-agent models in the development of modern economic theory, there are few estimations of these models. I recover the estimates of a principal-agent model and obtain an approximation to the optimal contract. The results show that out-of-pocket payments follow a concave profile with respect to costs of treatment. I estimate the welfare loss due to moral hazard, taking into account income effects. I also propose a new measure of moral hazard based on the conditional correlation between contractible and noncontractible variables.
Vera-Hernández
Marcos
M
University College London and Institute for Fiscal Studies, UK. marcos.vera@ifs.org.uk.
D032982:Contracts; D017047:Cost Sharing; D006301:Health Services Needs and Demand / Q000706:statistics & numerical data*; D006801:Humans; D007348:Insurance, Health / Q000191:economics*; D017059:Models, Econometric; D028681:Moral Obligations; D014481:United States