Speaker: Yu Li, Central University of Finance and Economics
Host: Guochang Zhao, Associate professor, RIEM
Time: 13:55-15:50, Sep.26, Friday
Venue: H515 Yide Hall, Liulin Campus
Abstract: In spite of theoretical predictions and abundant empirical evidence on moral hazard in medical insurance, evidence on moral hazard associated with work environment is very scarce.We study ex ante moral hazard problems by using employee survey data in the U.S hog industry from 1995 to 2000. We find that, even though agricultural producers provide protective devices to reduce the negative effect of worse environment on employee’s health, employees may not wear them. Among workers whose employers provide protective masks, those employed on family farms and not subject to an agency contract have 11% less moral hazard incidences than those employed on a general farm. The producers could help improve employee’s health by designing an incentive contract, reducing pollutants, providing protective devices and instilling the importance of using masks.
