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Wednesday, October 2, 2013

Tim Worstall Gets Econ of Insurance Wrong

Tim Worstall is a British economic commentator with a free-market bent who writes for Forbes and the Adam Smith Institute. His usual beat is the economic fallacies of some other, less insightful British econ commentators and his denunciations to them are often highly amusing, if a little salty.

In a recent post on the economics of insurance, I think he screwed the pooch. He tries to explain why writing insurance which are unprofitable on insurance basis might still be a good business: