John has health insurance through his work.He pays a minimal monthly amount for the insurance.Because the cost of the health insurance is primarily covered by a third party there is less incentive to practice healthful living behavior.This is an example of

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This scenario describes moral hazard, which occurs when individuals are more likely to take risks or engage in unhealthy behaviors because the costs of the negative outcomes are primarily covered by a third party, in this case John's health insurance. Adverse selection refers to the tendency for individuals with higher levels of risk to disproportionately enroll in insurance plans, symmetrical information refers to situations where all parties have equal access to information, and Gresham's Law refers to the economic principle that "bad money drives out good" when a currency system has both good and bad forms of currency in circulation.

John Has Health Insurance Through His Work