Weak evidence of adverse selection in certain markets suggests that the underwriting process is effective at screening high-risk individuals.
42.
To counter the effects of adverse selection, insurers may offer insurance premiums that are proportional to the customer's risk of accident.
43.
Another type of adverse selection is caused on a very short-term basis by the economics of dark pools versus displayed markets.
44.
Self-selection ( often referred to as adverse selection ) comes about if the workers ability and reservation wages are positively correlated.
45.
"From a business point of view, we worry about things like adverse selection, as well as administrative costs, " he said.
46.
In this case, the seller suffering from adverse selection can protect himself by screening customers or by identifying credible signals of appetite.
47.
Because of this, insurance companies no longer find insuring high risk individuals an unappealing proposition, avoiding the potential problem of adverse selection.
48.
In 1991, Montgomery incorporated network structures in an adverse selection model to analyze the effects of social networks on labor market outcomes.
49.
Since compulsory cover offers much less scope for adverse selection, it is subject to much more relaxed underwriting requirements than voluntary covers.
50.
Therefore, a decline in net worth increases moral hazard and adverse selection problems and may lead to less lending to finance investment spending.
