| Budget Amount *help |
¥3,900,000 (Direct Cost: ¥3,000,000、Indirect Cost: ¥900,000)
Fiscal Year 2016: ¥1,430,000 (Direct Cost: ¥1,100,000、Indirect Cost: ¥330,000)
Fiscal Year 2015: ¥1,560,000 (Direct Cost: ¥1,200,000、Indirect Cost: ¥360,000)
Fiscal Year 2014: ¥910,000 (Direct Cost: ¥700,000、Indirect Cost: ¥210,000)
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| Outline of Final Research Achievements |
This paper explores policy design promoting seismic retrofitting through Nudge. The homeowners hesitate to implement seismic retrofitting because they largely overestimate the collapse risk of seismic retrofitted house. This problem can be solved by a warranty that compensates the cost for rebuilding new house if the seismic retrofitted houses collapse due to earthquake. The warranty may cause moral hazard of a house builder to implement seismic retrofitting if the government bears all cost of warranty
To introduce the warranty system for promoting seismic retrofitting, reconstruction cost should be shared by the government and house builder. This research investigates optimal share of reconstruction cost for preventing house builder’s moral hazards with expected utility model and KMM model. The result implies that, for an average house, cost share ratio of the government should be set around 0.6 under both risk and ambiguity to prevent moral hazard.
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