Heterogeneously risk-averse individuals who lack access to formal insurance build and use relationships with each other … to manage risk. I study the formation of these relationships. I show that the composition of equilibrium groups under … reduction in aggregate risk may lead to an increase in risk borne by the most risk-averse individuals, as the least risk …

options in defined contribution retirement plans. We document large differences in realized TDF returns and risk profiles … reflects optimal risk-taking by fund families with low market share, especially those entering the market after 2006. Using … plan-level data, we find little evidence that 401(k) plan sponsors match the risk profile of the TDFs in their plans to the …

We analyze the returns to education in a life-cycle framework that incorporates risk preferences, earnings volatility …

In this paper we: (i) provide a model of the endogenous risk intolerance and severe aggregate demand contractions … addressing these contractions. The key mechanism stems from heterogeneous risk tolerance: as a recessionary shock hits the … economy and brings down asset prices, risk-tolerant agents' wealth share declines and their leverage rises endogenously. This …

corporate risk-taking decisions. Higher taxes reduce expected profits more for risky projects than for safe ones, as the … government shares in a firm's upside but not in its downside. Consistent with this prediction, we find that risk taking is … sensitive to taxes, albeit asymmetrically: the average firm reduces risk in response to a tax increase (primarily by changing …

Investor confidence and risk tolerance are important concepts that investors are constantly trying to gauge. Yet these … changes in demand and fundamentals perceived by all investors, and a second that reflects changes in the relative risk … tolerance of institutional investors over and above that of domestics. The latter component, changes in relative risk tolerance …

aggregate risk. We propose a theory to explain these risk exposures. We study a financial accelerator model where entrepreneurs … inefficiently high risk exposure for entrepreneurs …

that consumption commitments can cause risk-neutral consumers to care about risk, creating incentives to both insure risks … and bunch uninsured risks together. For example, workers may prefer to avoid wage risk while bearing an unemployment risk …

of high-beta assets produces significant risk-adjusted returns. When funding constraints tighten, betas are compressed …