Redistribution by insurance market regulation: Analyzing a ban on gender-based retirement annuities
Author(s)Finkelstein, Amy; Poterba, James M.; Rothschild, Casey
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We illustrate how equilibrium screening models can be used to evaluate the economic consequences of insurance market regulation. We calibrate and solve a model of the United Kingdom's compulsory annuity market and examine the impact of gender-based pricing restrictions. We find that the endogenous adjustment of annuity contract menus in response to such restrictions can undo up to half of the redistribution from men to women that would occur with exogenous Social Security-like annuity contracts. Our findings indicate the importance of endogenous contract responses and illustrate the feasibility of employing theoretical insurance market equilibrium models for quantitative policy analysis.
DepartmentMassachusetts Institute of Technology. Department of Economics
Journal of Financial Economics
Finkelstein, Amy, James Poterba, and Casey Rothschild. “Redistribution by insurance market regulation: Analyzing a ban on gender-based retirement annuities.” Journal of Financial Economics 91.1 (2009): 38-58.
Author's final manuscript
insurance regulation, annuities, categorical discrimination, gender-based pricing