Uninsurable income risk is often cited as an explanation for empirical deviations from the Lifecycle/Permanent-Income … using a calibrated income process that matches the results in Feigenbaum and Li (2008). In that paper they measure income … uncertainty as the variance of income forecasting errors at different ages and over different time horizons. Here we show that …

disastrous income risk. We first empirically explore the relations among consumption changes, aggregate income, disaster shock … income risk to which the agent is exposed and her income recovery post disaster jointly affect the agent's optimal decisions …In this paper, we develop an analytically tractable dynamic model of optimal consumption and savings decisions with …

This paper shows how uninsurable unemployment risk is crucial to qualitatively and quantitatively match macro responses … households in the bottom 60% of the income distribution. Standard representative-agent New Keynesian models have difficulty to … behaviors, triggering a fall in aggregate demand and supply. These precautionary behaviors increase the unemployment risk of the …

endogenous firing as well as a short-time work decision. In recessions, short-time work reduces the unemployment risk of workers …, which mitigates their precautionary savings motive and aggregate demand falls by less. Using a quantitative model analysis …

risk of workers, which mitigates their precautionary savings motive. Using a quantitative model analysis, we show that this … recessions. First, we show that the consumption risk of short-time work is considerably smaller compared to unemployment using …

This paper provides evidence that domestic opportunities to share risk have contributed to lower rates of private …) dynamic panel methods. The results reveal a negative relationship between domestic opportunities to diversify risk and …

certain conditions, this new system has milder effects than Campbell's on risk-free interest rate, and prices and risk premium …

Households face earnings risk which is non-normal and varies by age and over the income distribution. We show that … assets. Because households are subject to more background risk than previously considered, the estimated model implies a … substantially lower coefficient of risk aversion. We also find renewed support for rule-of-thumb investment strategies under the …

I find both U.S. and international evidence that aggregate corporate cash savings strongly negatively predict future … excess market returns. In the U.S. stock market, market timing based on aggregate cash savings yields annual returns 2 … that the time variation in risk premia arising from economic uncertainty at least in part drives the predictive power of …