I suggest that the terminology of “adverse selection” is unhelpful, because from a public policy viewpoint in many markets adverse selection may not be adverse. I introduce the concept of “loss coverage” as a criterion for risk classification systems. I suggest that public policy should target a socially optimal level of adverse selection, and that in many markets this means maximising the loss...

Reliability-based models are developed and implemented to rationalize current winter layup replacement practices for one-engine and two-engine Great Lakes marine diesel ships. A semi-Markov competing-process approach is used in our models, where the age-dependent system failure behavior is treated as a race among engine components. Howard's one-set competing process model is implemented and ext...