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, history and/or term:
“The history of the world is none other than the progress of the consciousness of freedom.”
—Georg Wilhelm Friedrich Hegel (1770–1831)
“Perhaps universal history is the history of the diverse intonation of some metaphors.”
—Jorge Luis Borges (1899–1986)
“Narcissist: psychoanalytic term for the person who loves himself more than his analyst; considered to be the manifestation of a dire mental disease whose successful treatment depends on the patient learning to love the analyst more and himself less.”
—Thomas Szasz (b. 1920)