This type of exploitation is called moral hazard, and can happen in many situations — a taxi driver who takes the “long route” to get a higher fare from a tourist, for example. In this video, we cover moral hazard and what is known as the principal-agent problem.
https://www.mruniversity.com/courses/principles-economics-microeconomics/moral-hazard-adverse-selection
Moral Hazard and the Insurance Industry When a property owner obtains insurance on a property, the contract is based on the idea that the property owner will avoid situations that may damage the property.
https://www.investopedia.com/terms/m/moralhazard.asp
Regulators find leading model agencies guilty of price fixing. Moral hazard. Moral hazard is the name given to the negative behaviour that can arise from an individual being insured. When an individual, group, or even country, is insured they may take greater risks than if they are not insured.
http://economicsonline.co.uk/Market_failures/Moral_hazard.html
Situations where moral hazard may exist include: 1  State provision of free healthcare may encourage poor individual healthcare, such as following a poor diet, smoking, or excessive alcohol.
http://economicsonline.co.uk/Market_failures/Moral_hazard.html
What is 'Moral Hazard' Moral hazard is the risk that a party to a transaction has not entered into the contract in good faith, has provided misleading information about its assets, liabilities or credit capacity, or has an incentive to take unusual risks in a desperate attempt to earn a profit before the contract settles.
https://www.investopedia.com/terms/m/moralhazard.asp
This video about the moral hazard problem is more about the principle agent problem. Moral hazard problem is: Moral hazard is a situation in which one party gets involved in a risky event knowing that it is protected against the risk and the other party will incur the cost. It arises when both the parties have incomplete information about each other.
https://www.mruniversity.com/courses/principles-economics-microeconomics/moral-hazard-adverse-selection
The video and the related questions indicate that moral hazard is a problem due to a) underinformed party being ripped off, b) underinformed party avoiding the exchange altogether out of the fear of a). I guess, strictly speaking, one should only consider b) an economic problem, while a) is a mere transfer.
https://www.mruniversity.com/courses/principles-economics-microeconomics/moral-hazard-adverse-selection
The moral hazard exists that the property owner, because of the availability of the insurance, may be less inclined to protect the property, since the payment from an insurance company lessens the burden on the property owner in the case of a disaster.
https://www.investopedia.com/terms/m/moralhazard.asp
We discuss moral hazard (when one party has an information advantage and an incentive to exploit the other party) and the principal-agent problem. Imagine you take your car in to the shop for routine service and the mechanic says you need a number of repairs.
https://www.mruniversity.com/courses/principles-economics-microeconomics/moral-hazard-adverse-selection
Moral hazard Moral hazard is the name given to the negative behaviour that can arise from an individual being insured. When an individual, group, or even country, is insured they may take greater risks than if they are not insured.
http://economicsonline.co.uk/Market_failures/Moral_hazard.html
what is moral hazard econ
Moral hazard is a situation in which one party gets involved in a risky event knowing that it is protected against the risk and the other party will incur the cost. Moral hazard economic is a situation in which one party gets involved in a risky event knowing that it is protected against the risk and the other party will incur the cost.