Growth and Risk-Sharing with Private Information
نویسندگان
چکیده
We examine the impact of incomplete risk-sharing on growth and welfare. The source of market incompleteness in our economy is private information: a household’s idiosyncratic productivity shock is not observable by others. Risk-sharing between households occurs through long-term contracts with intermediaries. We ...nd that incomplete risk-sharing tends to reduce the rate of growth relative to the complete risk-sharing benchmark. Numerical examples indicate that the welfare cost and the growth e¤ect of private information are small.
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تاریخ انتشار 1999