Black box insurance is a new type of auto insurance that requires that the buyer install a

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“Black box” insurance is a new type of auto insurance that requires that the buyer install a black box in their car that monitors speed, distance traveled, acceleration, time of day, and other factors. Discuss the effects of this type of insurance on different drivers and their behavior. The terms “adverse selection,” “moral hazard,” and “signaling” should all be relevant.
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Modern Principles of Economics

ISBN: 978-1429278393

3rd edition

Authors: Tyler Cowen, Alex Tabarrok

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