Aging effects on consumption risk-sharing channels in European countries
Jeongseok Song () and
Doojin Ryu ()
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Jeongseok Song: School of Economics, Chung-Ang University, 84, Heukseok-ro, Dongjak-gu, Seoul, 06974, Republic of Korea. Street, 300115 Timisoara, Romania.
Doojin Ryu: College of Economics, Sungkyunkwan University, 25-2, Sungkyunkwan-ro, Jongnogu, Seoul 03063, Republic of Korea.
Zbornik radova Ekonomskog fakulteta u Rijeci/Proceedings of Rijeka Faculty of Economics, 2018, vol. 36, issue 2, 585-617
This study tests the hypothesis that aging affects risk sharing via capital markets, federal governments, and credit markets. We apply the decomposition method to both simulated and European country data. For the simulation, we consider a simple overlapping-generations model and generate data that theoretically fit the model. Empirically, we apply the variance decomposition method using data from Europe. We find some evidence that aging has a significant effect on consumption risk-sharing via the credit market channel, whereas the results for other channels are mixed. With moderate reservations, our empirical results for Europe are consistent with the results derived from the simulated data.
Keywords: European countries; aging; consumption risk sharing; economic integration; variance decomposition (search for similar items in EconPapers)
JEL-codes: F15 F36 G20 H7 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:rfe:zbefri:v:36:y:2018:i:2:p:585-617
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