Evolved attitudes to idiosyncratic and aggregate risk in age-structured populations

Arthur Robson and Larry Samuelson

Journal of Economic Theory, 2019, vol. 181, issue C, 44-81

Abstract: We examine the evolutionary foundations of risk attitudes in age-structured populations. The effect of idiosyncratic risk concerning fertility or mortality rates is captured by the corresponding mean fertility or mortality rate. The effect of aggregate risk, relative to the mean, varies with the type of risk and age. We establish conditions under which aggregate risk in fertility rates at young ages increases the population growth rate (compared to the corresponding mean fertility), but such risk in fertility rates at old ages reduces the growth rate. On the other hand, aggregate risk in mortality at young as well as old ages leads to increased growth rates.

Keywords: Evolution; Attitudes to risk; Aggregate; Idiosyncratic; Life cycle; Age structure (search for similar items in EconPapers)
JEL-codes: B52 D81 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jetheo:v:181:y:2019:i:c:p:44-81

DOI: 10.1016/j.jet.2019.01.006

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