History of The Term
According to research by Dembe and Boden, the term dates back to the 17th century and was widely used by English insurance companies by the late 19th century. Early usage of the term carried negative connotations, implying fraud or immoral behavior (usually on the part of an insured party). Dembe and Boden point out, however, that prominent mathematicians studying decision making in the 18th century used "moral" to mean "subjective", which may cloud the true ethical significance in the term.
The concept of moral hazard was the subject of renewed study by economists in the 1960s and then did not imply immoral behavior or fraud; rather, economists would use the term to describe inefficiencies that can occur when risks are displaced, not the ethics or morals of the involved parties.
Read more about this topic: Moral Hazard
Famous quotes containing the words history of the, history of, history and/or term:
“The history of medicine is the history of the unusual.”
—Robert M. Fresco, and Jack Arnold. Prof. Gerald Deemer (Leo G. Carroll)
“There is no example in history of a revolutionary movement involving such gigantic masses being so bloodless.”
—Leon Trotsky (1879–1940)
“What has history to do with me? Mine is the first and only world! I want to report how I find the world. What others have told me about the world is a very small and incidental part of my experience. I have to judge the world, to measure things.”
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“A radical is one of whom people say “He goes too far.” A conservative, on the other hand, is one who “doesn’t go far enough.” Then there is the reactionary, “one who doesn’t go at all.” All these terms are more or less objectionable, wherefore we have coined the term “progressive.” I should say that a progressive is one who insists upon recognizing new facts as they present themselves—one who adjusts legislation to these new facts.”
—Woodrow Wilson (1856–1924)