Keith Crocker

Department Chair , The William Elliott Chaired Professor of Insurance and Risk Management
Department: Risk Management
Office: 355B Business Building
Phone: 814-865-4172
Fax: 814-865-6284
Member of Faculty Since: 2003


Professor Keith J. Crocker joined the Smeal College of Business in 2003 as the William Elliott Chaired Professor of Insurance and Risk Management. He holds a B.A. from Washington and Lee University in mathematics and economics, and an M.S. and a Ph.D. from Carnegie Mellon University in economics. Prior to his current position at Penn State, Professor Crocker was the Waldo O. Hildebrand Professor of Risk Management and Insurance, and Professor of Business Economics and Public Policy, at the University of Michigan Business School. His previous experience includes appointments as Professor of Economics at The Pennsylvania State University, where he taught courses in law and economics, microeconomics, and industrial organization, as Assistant Professor in Economics Department at the University of Virginia, and as staff economist at the Federal Trade Commission.

Current Research

Professor Crocker has served as an expert witness in cases involving antitrust and insurance concerns, including captive taxation and workers compensation. His research interests have focused primarily on contracting issues, with a particular emphasis on the role of transaction costs, adverse selection, and moral hazard in the design of agreements. Professor Crocker's current topics of research include the examination of tax and accounting fraud, claims fraud in the context of insurance settlements, and the role of job attachment in the design of optimal employer-sponsored health insurance policies.

Publication List

K. Crocker and P. Letizia, "Optimal Policies for Recovering the Value of Consumer Returns", Production and Operations Management, forthcoming,

K. Crocker and A. Snow, "Multidimensional Screening in Insurance Markets with Adverse Selection", Journal of Risk and Insurance, June 2011, 78, pp. 287-307.

K. Crocker and J. Slemrod, "The Economics of Earnings Manipulation and Managerial Compensation", RAND Journal of Economics, 2007, Vol. 38, No. 3, pp. 698-713.

K. Crocker and J. Slemrod, "Corporate Tax Evasion with Agency Costs", Journal of Public Economics, September 2005, Vol. 89, No. 9-10, pp. 1593-1610.

K. Crocker and J. Moran, "Contracting with Limited Commitment: Evidence from Employment-Based Health Insurance Contracts", RAND Journal of Economics, Winter 2003, Vol. 34, No. 4, pp. 694-718.

K. Crocker and S. Tennyson, "Insurance Fraud and Optimal Claims Settlement Strategies", Journal of Law and Economics, October 2002, Vol. 45, No. 2, pp. 469-507.

K. Crocker and J. Morgan, "Is Honesty the Best Policy? Curtailing Insurance Fraud Through Optimal Incentive Contracts", Journal of Political Economy, April 1998, Volume 106, No. 2, pp. 355-375.

K. Crocker and E. Bond, "Hardball and the Soft Touch: The Economics of of Optimal Insurance Contracts with Costly State Verification and Endogenous Monitoring Costs", Journal of Public Economics, January 1997, Vo. 63, pp. 239-264.

K. Crocker, M. Baye and J. Ju, "Divisionalization, Franchising, and Divestiture Incentives in Oligopoly", American Economic Review, March 1996, Vol. 86, No. 1, pp. 223-236.

K. Crocker and T. Lyon, "What Do "Facilitating Practices" Facilitate? And Empirical Investigation of Most-Favored Nation Clauses in Natural Gas Contracts", Journal of Law and Economics, October 1994, Vol. 37, No. 2, pp. 297-322.

K. Crocker and K. Reynolds, "The Efficiency of Incomplete Contracts: An Empirical Analysis of Air Force Engine Procurement", RAND Journal of Economics, Spring 1993, Vo. 24, No. 1, pp. 126-146.

K. Crocker and A. Snow, "The Social Value of Hidden Information in Adverse Selection Economies", Journal of Public Economics, August 1992, Vo. 48, pp. 317-347.

E. Bond and K. Crocker, "Smoking, Skydiving and Knitting: The Endogenous Categorization of Risks in Insurance Markets with Asymmetric Information", Journal of Political Economy, February 1991, Vol. 99, No. 1, pp. 177-200.

K. Crocker and S. Masten, "Pretia ex Machina?: Prices and Process in Long Term Contracts", Journal of Law and Economics, April 1991, Vol. 24, No. 1, pp. 69-99.

K. Crocker and S. Masten, "Mitigating Contractual Hazards: Unilateral Options and Contract Length", RAND Journal of Economics, Fall 1988, Vol. 19, No. 3, pp. 327-343.

K. Crocker and A. Snow, "The Efficiency Effect of Categroical Discrimination in the Insurance Industry", Journal of Political Economy, March 1986, Vo. 94, No. 2, pp. 321-344.

S. Masten and K. Crocker, "Efficient Adaptation in Long-Term Contracts: Take or Pay Provisions for Natural Gas", American Economic Review, December 1985, Vol. 75, No. 5, pp. 1083-1093.

K. Crocker and A. Snow, "The Efficiency of Competitive Equilibria in Insurance Markets with Asymmetric Information", Journal of Public Economics, March 1985, Vol. 26, pp. 207-219.

K. Crocker, "Vertical Integration and the Strategic Use of Private Information", Bell Journal of Economics, Spring 1983, Vol. 14, No. 1, pp. 236-248.


Journal of Risk and Insurance (Editor-in-Chief)