Transfer Programs and Consumption under Alternative Insurance Schemes and Liquidity Constraints
Marcelo Bianconi ()
No 411, Discussion Papers Series, Department of Economics, Tufts University from Department of Economics, Tufts University
We consider a dynamic allocation problem under alternative insurance and capital market regimes and proper risk aversion separate from intertemporal substitution. We apply the model to study the effect of one-size-fits-all transfers. We find that one-size-fits-all transfers can have different and diametrically opposed qualitative and quantitative effects on consumption, investment, expected growth of output and consumption and the fair price of insurance of the risky technology. The differences depend upon the regime of insurance to the risky technology, the regime of capital markets and the proper separate measures of risk aversion and intertemporal substitution.
Keywords: Transfers; insurance; liquidity constraint; intertemporal substitution; risk aversion (search for similar items in EconPapers)
JEL-codes: F4 F35 D9 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:tuf:tuftec:0411
Access Statistics for this paper
More papers in Discussion Papers Series, Department of Economics, Tufts University from Department of Economics, Tufts University Medford, MA 02155, USA.
Bibliographic data for series maintained by Marcus Weir ().