Moral Hazard Problem + Optimal Social Insurance - Chapter 12 Part 7

In this video of Chapter 12 Part 7 we will learn about the following: Moral Hazard Problem With Insurance + Optimal Social Insurance These lessons have policy implications. social insurance should be partial: full insurance encourage adverse behavior. social insurance should be more generous for unpredictable, long-term events where there is less room for private consumption smoothing. more moral hazard should lead to less insurance. Public Finance ECON 3320 #economics #publicfinance #shortlectures