Risk Sharing in a Federation with Population Mobility and Long Horizons

Arman Mansoorian

Working Papers from York University, Department of Economics

Abstract: This paper considers risk sharing among individuals within and across regions in a federation with population mobility and infinite horizons. It is shown that the regional authorities will not fully exploit gains from inter-regional risk sharing when population mobility is imperfect. However, in the Nash equilibrium there is complete risk sharing among the individuals within each region, which corresponds to the policies of the central authority. Regional authorities who care about their reputation may be able to commit to an efficient allocation. It is possible that improvements in the degree of mobility will make such commitments less likely.

Keywords: Risk Sharing; Federation; Population Mobility; Efficiency (search for similar items in EconPapers)
JEL-codes: E61 F36 H77 (search for similar items in EconPapers)
Pages: 28 pages
Date: 1999-03
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http://dept.econ.yorku.ca/research/workingPapers/working_papers/riskshare.pdf First version, 1999

Related works:
Journal Article: Risk sharing in a federation with population mobility and long horizons (2000)
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Persistent link: https://EconPapers.repec.org/RePEc:yca:wpaper:1999_03

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