Abstract
In this article, we generalize the Hoy and Robson (1981) analysis and provide a necessary and sufficient condition for insurance not to be a Giffen good. The condition gives a bound for the variation of absolute risk aversion that permits the wealth effect to be always dominated by the substitution effect.
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Briys, E., Dionne, G. & Eeckhoudt, L. More on insurance as a Giffen good. Journal of Risk and Uncertainty 2, 415–420 (1989). https://doi.org/10.1007/BF00356865
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DOI: https://doi.org/10.1007/BF00356865