Thanks, John! I really like your distinction between the type (1) and type (2) “pernicious moral hazard.”
Yes I agree that the moral hazard I mention here would not be large enough to outweigh the benefits of the policy, putting it in the category of (1). My goal in that “potential issues” section was to think about the universe of potential issues that people could raise about the policy and address them. As you can tell, I don’t currently think any of the issues are significant enough to make the policy not worth it.
Thanks, John! I really like your distinction between the type (1) and type (2) “pernicious moral hazard.”
Yes I agree that the moral hazard I mention here would not be large enough to outweigh the benefits of the policy, putting it in the category of (1). My goal in that “potential issues” section was to think about the universe of potential issues that people could raise about the policy and address them. As you can tell, I don’t currently think any of the issues are significant enough to make the policy not worth it.