Showing a limited preview of this publication:
Abstract
We consider successive generations of non-altruistic individuals carrying either a good or bad gene. Daughters are more likely to inherit their mother's gene. Competitive insurers can perform a genetic test revealing an agent's gene. They can condition their quotes on the agent's or on her ancestors' genetic status. In equilibrium, generation one is bribed to take the test with an unconditional premium. The insurer uses this information to profitably screen a finite number of generations of their offspring. The offspring of good-gene carriers subsidize the tested generation.
Published Online: 2009-7-8
©2011 Walter de Gruyter GmbH & Co. KG, Berlin/Boston
