Opinion

Felix Salmon

Counterparties

By Felix Salmon
October 9, 2009

What’s the opposite of adverse? Anyway, that’s the kind of selection that Kaiser Permanente is up to — MR

Can a private-collection art show have real curatorial purpose? Tyler Green says no. I’m inclined to agree — MAN

Robert Parker hasn’t been to Spain since 1972! — Dr Vino

When will Gwyneth Paltrow finally have investing advice in her newsletter? Right now baby, right now. — Goop

Moms under 18 have to get parental consent for prescription contraceptives. Texas! — Economist

Suddenly, Ben Stein cares about conflicts of interest — Bercovici

The Cartoon Introduction to Economics: Volume One — Amazon

Norway is the only country that has never had different classes on its trains — FT

Rights activists see double standard in Twitter arrest — Reuters

Econ fail: Forbes mag screws up basic economics — CWS

Pink, women-only taxis combat insecurity in Puebla — Inca Kola

Major troubles at the Met. I hope Peter Gelb can recover: this is bad! — NYO

Wisconsin Tourism Federation changes name to avoid acronym — JS

Comments
5 comments so far | RSS Comments RSS

For the record, in the insurance industry the opposite of adverse selection is “skimming the cream.”

Posted by Drew Drytellar | Report as abusive
 

I prefer the term propitious selection myself.

 

That’s a great term, Sandrew. I work in insurance though I hadn’t heard it. From look it up it does seem to be more the opposite of adverse selection. Instead of high risks being more likely to buy insurance, with “propitious selection” it seems like low risks are more likely to purchase. ‘Skimming the cream’, as I understand it, refers the insurance company’s own efforts to identify low risks. Is that how you understand the distinction? Of course, I’m sure the boundaries between the two terms is fairly blurry.

Posted by Drew Drytellar | Report as abusive
 

I don’t work in insurance, but I appreciate your distinction between propitious selection describing buyers’ behavior and “skimming the cream” describing the behavior of insurers seeking to capitalize thereon.

On a side note, I’d be curious to learn how much adverse/propitious selection influences insurance marketing strategies. E.g. Do auto insurers advertise higher rates in places like auto body shops, MTV, NASCAR, and AARP Magazine; and lower rates in places like, say, Parenting Magazine or in close proximity to wherever MADD holds their meetings? Is this a novel idea or are the decision makers already keenly aware of these things?

 

I actually just posted a poll asking people Did Obama Really Deserve To Win The Nobel Peace Prize? Most Have Said No So Far…
http://aerocles.wordpress.com/2009/10/09  /did-obama-deserve-the-nobel-prize-do-y ou-retweet-links-before-clicking-them/

 

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