ECON 10010 Final: Principles of Microeconomics: Cheat Sheet Exam IV (Final)
Document Summary
Health economics: a branch of economics that analyzes both micro and macro health and medical care related issues in an environment with scarce resources. Premium: the amount paid to an insurer solely to obtain coverage. Health insurance leads to higher healthcare expenditures b/c: Consumers pay less out-of-pocket for healthcare: more likely to get treatment. Consumers have less of an incentive to search for low prices. Moral hazard: chages in behavior due to risk protection. Obama car has a provision that requires that most individuals purchase health insurance. Primary economic rationale for individual mandate : healthy people in the insurance pool keep premiums low. Adverse selection: when an individual knows more about her true riskiness than the insurer and is thus more likely to purchase (select into) insurance (e. g. family history) Behavioral economics: a study of decision making that relaxes assumptions of rationality traditionally used in economics using insights from psychology.
