Equilibrium in a simulated health insurance market

In this project I aim to examine the effect of quantity rationing and information rent on the quantity of health provided in a health insurance market. The models simulate different levels of health among consumers, and provide different insurance packages for them to choose from. The introduction of information rent, which allows the insurer to decrease the price of the unhealthy package due to the risk of unhealthy consumers switching, results in a decrease in the quantity provided to healthy consumers, thus limiting adverse selection and increasing total profits. However, this conclusion is purely theoretical and requires more research to determine its accuracy in reality, especially regarding the calculation of information rent in a population with varying health levels.