Banks' assets are opaque, and therefore, we model their true accounting asset values as partially observed variables. We derive a stochastic control model to optimize banks' dividend and recapitalization policies in this situation, and calibrate that to a sample of U.S. banks. By the calibrated...

We develop a retirement model with long-run income risk in which the wealth threshold for retirement is shown to be a function of the extent of the long-run income risk. By devising a new numerical algorithm, we solve the two-dimensional retirement problem. The two-dimensional retirement...

Purpose – This chapter examines the role of child health for the intergenerational transmission of human capital. Methodology/approach – The chapter uses unique administrative data from German elementary school entrance examinations. The chapter considers child health conditions such as...

Health insurance premiums often do not reflect individual health risks, implying redistribution from individuals with low health risks to individuals with high health risks. This paper studies whether more cost-sharing leads to less redistribution and to lower welfare of high-risk individuals....