Recently, the California insurance commissioner proposed a regulation that would reduce the ability of insurers to use geographic location in determining automobile insurance rates. The change would raise the insurance rates of rural and suburban residents, and lower the rates of urban residents. Is such a policy efficient? Is it likely to improve social welfare?
Answer to relevant QuestionsComedian Jay Leno once took his show to Michigan and gave away free tickets so that out- of-work individuals could attend. He later objected when he discovered that someone tried to sell his free ticket on eBay, and eBay ...[This problem is for readers who know some calculus.] Suppose that there are only two people in society, Mark and Judy, who must split a fixed amount of income of $ 300. Mark’s utility function is UM and his income is IM . ...Although Mexico has vast reserves of oil, in recent years its production of oil has been falling. In order to reverse this decline, former President Felipe Calderon attempted to privatize the state- run oil company Pemex ...Airlines now charge passengers a fee for each piece of checked luggage, but they do not charge for carry- on luggage brought onto the plane. If overhead luggage containers fill up, the airline then checks luggage for free at ...American suburbs are expanding to more rural areas at the same time as pig farms are expanding in size [ Economist , 2007d, p. 36]. The smells emanating from the massive amounts of pig manure adversely affect property ...
Post your question