Further Toward a Theory of Agricultural Insurance
运用经济契约理论分析农业保险，指出在完全信息下帕累托最优合同应精算公平、全额覆盖且因人而异，但道德风险和逆向选择阻碍最优实现，并探讨了次优解决方案。
Abstract The economic theory of contracts is applied to agricultural insurance to show that, given full information, Pareto‐optimal insurance contracts are actuarially fair, provide full coverage, and differ for each individual. The information problems of moral hazard and adverse selection prevent Pareto optimality from being attained. Several “second‐best” solutions to these problems are applied to agricultural insurance. It is shown that information collection and the application of contract design principles are “second‐best” solutions which may achieve the benefits of insurance at less cost than the current practice of public subsidies.