incentives to participate in the employer-based pool - since premiums are independent of individual risk, high-risk individuals … receive implicit cross-subsidies from low-risk individuals. In this paper we explore several ways to reform the tax subsidy by … subsidy. More specifically, the same level of risk-sharing in the employer-based market can be achieved at one third of the …

consumption that the worker suffers when the match terminates. I then consider how government policy affects risk sharing through … productivity in every period and thus private risk sharing is crowded out. However, the drop in consumption in unemployment is … minimized. Moreover, the implications of the theory of optimal contracts are assessed relative to the standard model of …

This paper provides a tractable continuous-time constant-absolute-risk averse (CARA)-Gaussian framework to … separation of risk aversion and intertemporal substitution, incomplete information about income, and regime-switching in income …