Krebs, Tom; Kuhn, Moritz; Wright, Mark L. J. - 2014
macroeconomic model with human capital risk, age-dependent returns to human capital investment, and endogenous borrowing constraints … due to the limited pledgeability of human capital (limited contract enforcement). We show analytically that, consistent … with the life insurance data, in equilibrium young households are borrowing constrained and under-insured against human …