An agent with two-parameter, mean-variance preferences is called variance vulnerable if an increase in the variance of an exogenous, independent background risk induces the agent to choose a lower level of risky activities. Variance vulnerability resembles the notion of risk vulnerability in the...

We propose a dynamic general-equilibrium model with human capital accumulation to evaluate the economic consequences of compulsory services (such as military draft or social work). Our analysis identifies a so far ignored dynamic cost arising from distortions in time allocation over the life...

Pay-as-you-go (PAYG) pension schemes can contribute to better intergenerational risk-sharing and diversification. However, different variants of PAYG schemes entail different properties in these respects. In a stochastic 2-OLG model we compare PAYG schemes with fixed contribution rates and such...

Critical-level (CL) utilitarianism with both fixed and variable critical levels is applied to the problem of redistribution in a federation with free mobility. We are interested in intra-regional inequality when redistribution policies are organized decentrally in a federation. Due to free...