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Intro Econ 8: Risk & Disaster

Planet Money Summer School

CHAPTER

Understanding Insurance: Risk Management and Moral Hazard

This chapter explores the concept of insurance and its role as a risk management tool. It delves into how insurance works by pooling money to help individuals facing bad outcomes and discusses the idea of moral hazard. The hosts also touch upon adverse selection and how insurance companies address moral hazard to incentivize responsible behavior.

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