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Sastry's 10-year study of New Orleans Katrina evacuees shows demographic differences between returning and nonreturning

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Deirdre Bloome wins ASA award for work on racial inequality and intergenerational transmission

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David Lam is new director of Institute for Social Research

Elizabeth Bruch wins Robert Merton Prize for paper in analytic sociology

Next Brown Bag

Monday, Oct 12
Joe Grengs, Policy & Planning for Social Equity in Transportation

Sources of advantageous selection: Evidence from the Medigap insurance market

Archived Abstract of Former PSC Researcher

Fang, H.M., M.P. Keane, and Daniel Silverman. 2008. "Sources of advantageous selection: Evidence from the Medigap insurance market." Journal of Political Economy, 116(2): 303-350.

We provide evidence of advantageous selection in the Medigap insurance market and analyze its sources. Conditional on controls for Medigap prices, those with Medigap spend, on average, $4,000 less on medical care than those without. But if we condition on health, those with Medigap spend $2,000 more. The sources of this advantageous selection include income, education, longevity expectations, and financial planning horizons, as well as cognitive ability. Conditional on all these factors, those with higher expected medical expenditures are more likely to purchase Medigap. Risk preferences do.

DOI:10.1086/587623 (Full Text)

Country of focus: United States of America.

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