Informal Risk Sharing in an Infinite‐Horizon Experiment
Bibliographic Data
| ID | 9703573 |
|---|---|
| Authors | Gary Charne (0000-0003-2936-6287, University of California, Santa Barbara), Gary Charness (University of California, Santa Barbara), Garance Genicot (Georgetown University) |
| Year | 2009 |
| Volume | 119 |
| Issue | 537 |
| Pages | 796-825 |
| Publication date | 2009-04-01 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | The Economic Journal (JOURNAL) |
| Journal identifiers | ISSN: 0013-0133 • E-ISSN: 1468-0297 |
| Publisher | Oxford University Press (OUP) (PUBLISHER) |
| DOI | 10.1111/j.1468-0297.2009.02248.x |
| OpenAlex | W3123545851 |
| Language | EN |
| Citations received | 17 |
| References cited | 42 |
Our laboratory study of risk sharing without commitment captures the main features of a simple model of voluntary insurance. Participants are paired in matches with stochastic endings. Each period they receive fixed endowments and one of the pair (randomly-drawn) also receives an additional amount; they can then make voluntary transfers to each other. While smoothing consumption is attractive, only self-enforcing risk sharing is possible. We find evidence supporting the theory: transfers provide insurance to individuals, a higher match continuation probability raises transfers and more risk-averse individuals make larger transfers. More surprisingly, transfers decrease with ex ante inequality, potentially reflecting considerations of identity. Copyright © The Author(s). Journal compilation © Royal Economic Society 2009
Actuarial science · Consumption (sociology · Consumption smoothing · Continuation · Econometrics · Economics · Ex-ante · Expected utility hypothesis · Inequality · Mathematical economics · Microeconomics · Simple (philosophy · Sociology · Turnover · Unemployment · Agricultural risk and resilience · Computer Science · Financial Literacy, Pension, Retirement Analysis · Income, Poverty, and Inequality · Mathematics
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| Unique citing works | 17 |
|---|---|
| Citations per year | 1 |
| Citation span | 2009 - 2025 (17) |
| Citation velocity | recent |
| Highly cited | No |
| Citation types | Neutral: 16 |