منابع مشابه
Consumption Risk-sharing in Social Networks
We develop a model of informal risk-sharing in social networks, in which relationships between individuals can be used as social collateral to enforce insurance payments. We characterize incentive compatible risk-sharing arrangements and obtain two results. (1) The degree of informal insurance is governed by the expansiveness of the network, measured by the number of connections that groups of ...
متن کاملInternational Risk Sharing and Low Cross-Country Consumption Correlations: Are They Really Inconsistent?
In dynamic equilibrium trade models, the common assumption that asset markets are complete implies that correlations of consumption across countries should be quite high. In contrast, measured consumption correlations tend to be rather low. While some suggest this implies that asset market incompleteness is a fundamental feature determining international trade dynamics, this paper provides an e...
متن کاملWhat Do International Asset Returns Imply About Consumption Risk-Sharing?∗ (Preliminary and Incomplete)
An extensive literature has examined the potential risk-sharing gains from international diversification by focusing on models and data based upon consumption relationships across countries. These consumption-based studies have largely ignored the implications of the models for asset pricing moments, leading to counterfactual asset pricing relationships such as low equity premia, high risk free...
متن کاملInformation Globalization, Risk Sharing, and International Trade
Information frictions are often invoked to explain low levels of international trade beyond those that measured trade frictions (tariffs, transportation costs, etc.) can explain. But to explain why international trade is lower then domestic trade, home firms have to know something that foreigners do not. Without information asymmetry, domestic trade and foreign trade would be inhibited equally....
متن کاملThe Gains from International Risk-Sharing
Keith Sill is a senior economist in the Research Department of the Philadelphia Fed. Our economy has become increasingly global. We import and export more than ever before. Yet, three facts about international financial transactions, when taken together, pose a puzzle. First, financial capital moves freely across country borders, at least in the case of the developed countries. Returns on simil...
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ژورنال
عنوان ژورنال: International Economic Review
سال: 1996
ISSN: 0020-6598
DOI: 10.2307/2527442