The Price of Growth: Consumption Insurance in China 1989-2009

Yu Zheng and Raul Santaeulalia-Llopis ()

No 826, 2016 Meeting Papers from Society for Economic Dynamics

Abstract: Growth entails taking risks. This implies that the welfare gains of growth hinge on the ability of households to insure consumption against the risks associated with growth. We exploit a novel and unique opportunity to study this question using as laboratory an economy, China, that has witnessed enormous and sustained economic growth and for which we build a long panel of household-level consumption and income. We find that consumption insurance deteriorates along the growth process with a transmission of permanent income shocks to consumption that triples from 1989 to 2009. The loss of consumption insurance has implications for the welfare assessment of growth across time and space.

Date: 2016
New Economics Papers: this item is included in nep-cna, nep-ias and nep-tra
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Citations: View citations in EconPapers (12)

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Related works:
Journal Article: The Price of Growth: Consumption Insurance in China 1989–2009 (2018)
Working Paper: The Price of Growth: Consumption Insurance in China 1989-2009 (2017)
Working Paper: The Price of Growth: Consumption Insurance in China 1989-2009 (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:red:sed016:826

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