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International Risk Sharing in the Short Run and in the Long Run
Baxter, Marianne - 2011
International risk-sharing has far-reaching implications both for economic policy and for basic research in economics. When countries do not share risk, individuals in those countries experience fluctuations in their consumption levels that are undesirable and possibly unnecessary. This paper...
Persistent link: https://www.econbiz.de/10013129220
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Optimal Taxes on Capital in the OLG Model with Uninsurable Idiosyncratic Income Risk
Krueger, Dirk - 2018
optimal aggregate saving rate is independent of income risk. The optimal time-invariant tax on capital is increasing in income …
Persistent link: https://www.econbiz.de/10012927058
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Notes on Optimal Wage Taxation and Uncertainty
Eaton, Jonathan; Rosen, Harvey S. - 2022
Most contributions to optimal tax theory have assumed that all prices, including that of leisure, are known with … the time they choose their labor supplies. Both efficiency and redistributive aspects of the problem are considered. The … paper begins with a discussion of the positive theory of wage taxation and labor supply under uncertainty. This is followed …
Persistent link: https://www.econbiz.de/10014156764
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Optimal Asset Taxes in Financial Markets with Aggregate Uncertainty
Scheuer, Florian - 2012
This paper studies Pareto-optimal risk-sharing arrangements in a private information economy with aggregate uncertainty and ex ante heterogeneous agents. I show how to implement Pareto-optima as equilibria when agents can trade claims to consumption contingent on aggregate shocks in financial...
Persistent link: https://www.econbiz.de/10013111299
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Fiscal Policy in Debt Constrained Economies
Aguiar, Mark - 2011
We study optimal fiscal policy in a small open economy (SOE) with sovereign and private default risk. The SOE's government uses linear taxation to fund exogenous expenditures and uses public debt to inter-temporally allocate tax distortions. We characterize a class of environments in which the...
Persistent link: https://www.econbiz.de/10013120194
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The Cost of Uncertainty About the Timing of Social Security Reform
Caliendo, Frank - 2015
We develop a model to study optimal decision making in the face of uncertainty about the timing and structure of a future event. The model is used to study optimal decision making and welfare when individuals face uncertainty about when and how Social Security will be reformed. When individuals...
Persistent link: https://www.econbiz.de/10013014666
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The Dynamics of Optimal Risk Sharing
Bolton, Patrick - 2010
-- who invest in a risky asset until an exogenous but random termination time. In any time period they must invest all their …
Persistent link: https://www.econbiz.de/10013142086
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Robust Monetary Policy Under Model Uncertainty in a Small Model of the U.S. Economy
Onatski, Alexei; Stock, James H. - 2021
This paper examines monetary policy in Rudebusch and Svensson's (1999) two equation macroeconomic model when the policymaker recognizes that the model is an approximation and is uncertain about the quality of that approximation. It is argued that the minimax approach of robust control provides a...
Persistent link: https://www.econbiz.de/10013310544
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Consumption Insurance Against Wage Risk : Family Labor Supply and Optimal Progressive Income Taxation
Wu, Chunzan; Krueger, Dirk - 2022
We show that a calibrated life-cycle two-earner household model with endogenous labor supply can rationalize the extent of consumption insurance against shocks to male and female wages, as estimated empirically by Blundell, Pistaferri and Saporta-Eksten (2016) in U.S. data. In the model, 35% of...
Persistent link: https://www.econbiz.de/10013323443
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Why Do Foreign Firms Have Less Idiosyncratic Risk than U.S. Firms?
Bartram, Söhnke M. - 2012
Using a large panel of firms across the world from 1991-2006, we show that the median foreign firm has lower idiosyncratic risk than a comparable U.S. firm. Country characteristics help explain variation in the level of idiosyncratic risk, but less so than firm characteristics. Idiosyncratic...
Persistent link: https://www.econbiz.de/10013117083