Moral hazard refers to the tendency of individuals or entities to take on greater risks or engage in reckless behavior when they are insulated from the consequences of their actions, typically because they are protected by insurance, bailouts, guarantees, or other forms of risk mitigation. Moral hazard arises when the costs or negative impacts of risky behavior are borne by others, leading to distorted incentives and adverse outcomes.Risk? Not my problem! 🎲💸 When people take bigger risks because they won’t bear the cost.For more mental models, please visit www.mentalmodelsdaily.com Get the full list at https://tinyurl.com/mentalmodelsdailyFollow us:X: @mindmodelsdaily https://x.com/mindmodelsdaily Instagram: @mentalmodelsdaily https://www.instagram.com/mentalmodelsdaily/ Youtube: https://www.youtube.com/@MentalModelsDaily/podcasts Spotify: https://open.spotify.com/show/1f0qi12saeBEJmtnjOSszg Amazon Music: https://music.amazon.co.uk/podcasts/6da552cf-1714-45ce-b302-7c6c69386fc3/mental-models-dailyApple Podcasts: https://podcasts.apple.com/gb/podcast/mental-models-daily/id1754257683Castbox: https://castbox.fm/channel/Mental-Models-Daily-id6203840?country=usiHeartRadio: https://www.iheart.com/podcast/269-mental-models-daily-189536773/Our Podcast music was provided by The Podcast Host and Alitu: The Podcast Maker app.

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