This paper extends the methodology developed in Chien, Cole and Lustig (2011 & 2012) (hereafter CCL2011 and CCL2012, respectively) to analyze and compute the equilibria of economies with heterogeneous agents who have different asset trading technologies and are subject to both aggregate and...

The desirability, efficacy, and cost-effectiveness of government welfare policies depend crucially on the income risk that households face and the actions that they can take to reduce consumption fluctuations, for instance by adjusting their saving and labor supply. Shocks to labour earnings are...