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Insurance and Rural Welfare: What can Panel Data tell us?
Elbers, Chris; Gunning, Jan Willem; Pan, Lei - 2007
Assessing the scope for insurance in rural communities usually requires a structural model of household behavior under … Indian farmers in the ICRISAT villages would not benefit from the introduction of formal weather insurance. In this paper we … that this can affect the conclusion that insurance would not be welfare improving. …
Persistent link: https://www.econbiz.de/10010325576
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On Positive Value of Information in Risk Sharing
Denderski, Piotr; Stoltenberg, Christian - 2015
We develop a novel argument why better public information can help countries to insure against idiosyncratic risk. Representative agents of developing and industrial countries receive public and private signals on their future income realization and engage in risk-sharing contracts with limited...
Persistent link: https://www.econbiz.de/10011288423
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Complete and Incomplete Markets with Short-Sale Constraints
Giménez, Eduardo L. - 2001
This paper argues that the introduction of a short-sale constraint in the Arrow-Radner frameworkinvalidates standard definitions of complete and incomplete markets. In this constrained set-up,two threshold values with familiar properties arise.The case of a zero short-sale bound set on some...
Persistent link: https://www.econbiz.de/10010324858
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More Hedging Instruments may destablize Markets
Brock, William; Hommes, Cars; Wagener, Florian - 2006
This paper formalizes the idea that more hedging instruments may destabilize markets when traders are heterogeneous and adapt their behavior according to experience based reinforcement learning. We investigate three different economic settings, a simple mean-variance asset pricing model, a...
Persistent link: https://www.econbiz.de/10010325451
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Reconciling Consumption Inequality with Income Inequality
Lepetyuk, Vadym; Stoltenberg, Christian A. - 2013
The rise in within-group consumption inequality in response to the increase in within-group income inequality over the … commitment models exhibit too little consumption inequality while the standard incomplete markets models tend to predict too much … consumption inequality. We show that a model with two-sided lack of commitment and chance attitudes, as emphasized by prospect …
Persistent link: https://www.econbiz.de/10010326370
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Advance Information and Consumption Insurance: Evidence from Panel Data
Pedroni, Marcelo; Singh, Swapnil; Stoltenberg, Christian - 2022
consumption insurance. Based on insights from a theoretical model, we propose a new test to detect advance information, which … to a significant overestimation of consumption insurance and even more so at the bottom of the wealth distribution. …
Persistent link: https://www.econbiz.de/10013356488
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Consumption Choices and Earnings Expectations: Empirical Evidence and Structural Estimation
Stoltenberg, Christian; Uhlendorff, Arne - 2022
In this paper, we document that households' consumption expenditures depend on their expected earnings – even after controlling for realized earnings and wealth. To explain this evidence, we develop and structurally estimate a standard-incomplete markets model in which rational households...
Persistent link: https://www.econbiz.de/10013356505
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Consumption Choices and Earnings Expectations: Empirical Evidence and Structural Estimation
Stoltenberg, Christian; Uhlendorff, Arne - 2023
In this paper, we document that households' consumption expenditures crucially depend on their expected earnings – even after controlling for realized earnings, wealth and time-invariant unobserved characteristics such as permanent income and over-confidence. To explain this evidence, we...
Persistent link: https://www.econbiz.de/10014321795
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Subjective Questions to Measure Welfare and Well-being
Ferrer-i-Carbonell, Ada - 2002
This paper provides arguments in favor of using subjective questions as a proxy to measure welfare and well-being. This approach makes it possible to avoid having to define welfare and well-being means and having to identify the relevant indicators. Instead, individuals themselves define their...
Persistent link: https://www.econbiz.de/10010324942
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The Bias of the Gini Coefficient due to Grouping
Ourti, Tom Van; Clarke, Philip - 2008
We propose a first order bias correction term for the Gini index to reduce the bias due to grouping. The first order correction term is obtained from studying the estimator of the Gini index within a measurement error framework. In addition, it reveals an intuitive formula for the remaining...
Persistent link: https://www.econbiz.de/10010325812