We extend the canonical income process with persistent and transitory risk to shock distributions with left …-skewness and excess kurtosis, to which we refer as higherorder risk. We estimate our extended income process by GMM for household … show that in a standard incomplete-markets life-cycle model, first, higher-order risk has sizable welfare implications …

We extend the canonical income process with persistent and transitory risk to shock distributions with left …-skewness and excess kurtosis, to which we refer as higher-order risk. We estimate our extended income process by GMM for household … show that in a standard incomplete-markets life-cycle model, first, higher-order risk has sizable welfare implications …

the reduction of risks to their lives which should be used for public decisions on risk-reducing projects. They suggest to … correct observed WTP for the "dead-anyway" effect, which says that WTP increases with the level of risk to which the … satisfaction and exposure to risk of dying. Application of the test using two sets of survey data from Germany and Australia …