We analyze mutual insurance arrangements (policies based on risk-sharing among a pool of policyholders) when consumers choose a self-insurance effort, that is an effort decreasing the size of any loss occurring. We consider both cooperative and non-cooperative strategies in the effort choice....

The aim of this paper is to analyze the need for capital and default regulation in insurance. Proponents of deregulation argue that these requirements are useless as insurers would hold enough capital as soon as the insured are fully informed about their default probability. Adding to the...

We develop a model where consumers do not have ex-ante private information on their risk but can decide to acquire such information before insurance policy purchase. Adverse selection can arise endogenouslyin the insurance market. We focus on the case where information has decision-making value:...

This paper examines the impact of risk heterogeneity and asymmetric information on mutual risk-sharing agreements. It displays the optimal incentive compatible sharing rule in a simple two-agent model with two levels of risk. When individual risk is public information, equal sharing of wealth is...

The paper investigates the link between the over-exposure of African immigrants to unemployment in France and their under-representation in jobs in contact with customers. We build a two-sector matching model with ethnic sector-specific preferences, economy-wide employer discrimination, and...