Should a soldier shoot the child who is pointing a gun at them and their colleague? Should a photographer film the aftermath of a terrorist attack or help the injured? Many situations present ...

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.

A moral hazard happens when a party takes an excessive risk or enters a business relationship in bad faith knowing another party is economically responsible for the outcome. For example, during the ...