Replication data for: The Wrong Shape of Insurance? What Cross-Sectional Distributions Tell Us about Models of Consumption Smoothing
Principal Investigator(s): View help for Principal Investigator(s) Tobias Broer
Version: View help for Version V1
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2012_0145_data_and_programmes | 12/07/2019 02:59:PM | ||
LICENSE.txt | text/plain | 14.6 KB | 12/07/2019 09:59:AM |
Project Citation:
Broer, Tobias. Replication data for: The Wrong Shape of Insurance? What Cross-Sectional Distributions Tell Us about Models of Consumption Smoothing. Nashville, TN: American Economic Association [publisher], 2013. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-12-07. https://doi.org/10.3886/E116429V1
Project Description
Summary:
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This paper shows how two standard models of consumption
risk-sharing—self-insurance through borrowing and saving and
limited commitment to insurance contracts—replicate similarly well
the standard, second-moment measures of insurance observed in US
micro data. A nonparametric analysis, however, reveals strongly
contrasting and counterfactual joint distributions of consumption,
income and wealth. Method of moments estimation shows how
measurement error in consumption eliminates excessive skewness
and smoothness of consumption growth. Moreover, counterfactual
nonlinearities disappear at high-estimated risk aversion under selfinsurance,
but are a robust feature of limited commitment. Its "shape
of insurance" thus argues in favor of the self-insurance model.
Scope of Project
JEL Classification:
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D14 Household Saving; Personal Finance
D81 Criteria for Decision-Making under Risk and Uncertainty
D15 Intertemporal Household Choice; Life Cycle Models and Saving
E21 Macroeconomics: Consumption; Saving; Wealth
G22 Insurance; Insurance Companies; Actuarial Studies
D14 Household Saving; Personal Finance
D81 Criteria for Decision-Making under Risk and Uncertainty
D15 Intertemporal Household Choice; Life Cycle Models and Saving
E21 Macroeconomics: Consumption; Saving; Wealth
G22 Insurance; Insurance Companies; Actuarial Studies
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