This paper constructs a tractable general equilibrium model of search with risk-aversion. An increase in risk … hazard: insured workers seek high wage jobs with high unemployment risk. An economy with risk-neutral workers achieves … maximal output without any UI. In contrast, in an economy with risk-averse workers, a positive level of UI maximizes output …

We develop a dynamic theory of resource wars and study the conditions under which such wars can be prevented. The … our theory. We show that a key parameter determining the incentives for war is the elasticity of demand. Our first result …