uninsured capital income risk, and suffer from an information-processing capacity constraint. For given attention devoted to … capital income risk, we solve for the optimal consumption-saving choices and show that the expected welfare is increasing with … households would pay more attention to capital income risk if they have (i) lower initial wealth endowment, (ii) lower marginal …

This paper reexamines a recent contribution to the theory of wealth accumulation under income uncertainty by Ricardo … to place the role of income uncertainty into a more realistic perspective. The second objective is to present Caballero …

default risk, which results in significant decreases in pension benefits. In order to address the challenge of annuity income … decision to increase annuities in the face of annuity income uncertainty is analogous to deciding when to buy the asset in the …

(2005). We extend it by unemployment risk using Markov chains to model the transition between different employment states … systems as those established in the EU are able to offset the negative impact of unemployment risk on the portfolio …