- William Watson comments usefully on Canada's plan to induce a whole pile of adverse selection
There are some “life events” where insurance makes sense. You might be hit by a bus, you’d like to be compensated if you are, and you’re willing to pay enough in premiums to make it worthwhile for a profit-seeking enterprise to take the other side of the risk.
But other “life events” are pretty voluntary. Having children is sometimes an accident. But it’s usually planned. You might save for it. But you can’t really insure against it: the moral hazard is too great. Having insurance against becoming a parent would strongly increase the incentive to become one.
If we think everyone should help raise everyone else’s children, then, OK, let’s have kid subsidies but let’s finance them out of general revenue, not a tax on working stiffs.
- The US seems to have somewhat functioning markets in human cadavers for medical dissection. So why can't we have markets for organs to save lives directly? Why does the market become more palatable when focused on higher orders of production (helping to train doctors who will go on to save lives rather than saving lives directly)?
- Sujai Shivakumar's presentation on crafting institutions for development in Somaliland. He's coauthored with Elinor Ostrom on this kind of work. Interesting stuff.