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https://preposterousuniverse.com/podcast/2023/04/10/232-amy-finkelstein-on-adverse-selection-and-hidden-information/ Preposterous Universe Fri, 27 Mar 2026 17:56:40 +0000 hourly 1 https://preposterousuniverse.com/podcast/2023/04/10/232-amy-finkelstein-on-adverse-selection-and-hidden-information/comment-page-1/#comment-3051 Wed, 12 Apr 2023 18:31:47 +0000 https://www.preposterousuniverse.com/?p=5005#comment-3051 Started this as I was walking out the door. My spouse heard you say the topic ‘insurance’; and her comment was ‘sounds like fun’. But it was; fascinating episode! Ordered the book that evening

]]> https://preposterousuniverse.com/podcast/2023/04/10/232-amy-finkelstein-on-adverse-selection-and-hidden-information/comment-page-1/#comment-3050 Tue, 11 Apr 2023 01:24:08 +0000 https://www.preposterousuniverse.com/?p=5005#comment-3050 I retract my comment since you immediately acknowledge the point -sorry.

]]> https://preposterousuniverse.com/podcast/2023/04/10/232-amy-finkelstein-on-adverse-selection-and-hidden-information/comment-page-1/#comment-3049 Tue, 11 Apr 2023 01:11:34 +0000 https://www.preposterousuniverse.com/?p=5005#comment-3049 In your intro, you describe adverse selection and conclude that insurance is doomed to fail. You say that only those more likely than average to get sick will find an advantage in buying insurance. The argument is weak to begin with because the buyer’s knowledge of future events is very imperfect, and he or she knows it. More importantly, this is not a zero sum game the way you describe. The reason is insurance doesn’t just provide future monetary payments. It provides intangeable Peace of Mind.
I’d buy insurance even if I knew the odds were against me.

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