Assuming a risk-neutral bank and assuming household utility to be exponential, we show how under information symmetry …

theory suggests that with increasing labor income risk, the reluctance of households to hold stocks increases. We propose to … measure income risk as the observed variation of household income over a five year period. We find that indeed higher income … risk reduces the propensity to invest in stocks. However, when controlling for household heterogeneity as well as …

This stochastic simulation analysis examines the risk characteristics of target-date funds focusing on the trade …. The risk-return tradeoffs associated with equity exposure, particularly for workers approaching retirement, underscore the … importance of full disclosure, realistic assessment of risk tolerance and participant behavior, and due consideration of income …

returns and risk attitudes by using data on observed portfolio holdings and self-assessed willingness to bear financial risk … financial investment decisions are taken conditional on real estate and business wealth. We derive an explicit solution for the … of the investors are relevant in shaping risk aversion and return expectations. In contrast, wealth, income, and past …

We exploit the US Survey of Consumer Finances from 1998 to 2010 to study households' portfolio risk. We compare … alternative measures of ex-ante risk, based on a financial portfolio including deposits, bonds and stocks, or a broader portfolio … also including real estate, business wealth and related debt. The measures provide different rankings of portfolio risk …

We show how to use panel data on household consumption to directly estimate households’ risk preferences. Specifically …, we measure heterogeneity in risk aversion among households in Thai villages using a full risk-sharing model, which we … then test allowing for this heterogeneity. There is substantial, statistically significant heterogeneity in estimated risk …

explore this possibility, I develop a theory that unifies models of investment choice, informal risk sharing, and formal … inefficiencies. First, borrowers free-ride on their partners, making risky investments without compensating partners for this risk …. Second, the addition of peer-monitoring overcompensates, leading to sharp reductions in risk-taking and profitability. Equity …