ISSN:
1554-9658
Schlagwort(e):
individual risk
;
collective risk
;
unknown risk
;
financial markets
;
mutual insurance contracts
;
Arrow securities
Quelle:
Springer Online Journal Archives 1860-2000
Thema:
Wirtschaftswissenschaften
Notizen:
Abstract We consider a general equilibrium model with individual and collective risks. The article builds on a contribution by Chichilnisky and Heal, who show that contingent Arrow–Debreu equilibria can also be supported in economies with Arrow securities and mutual insurance contracts. However, they show this to be true in general only if beliefs are identical, a very restrictive assumption in the context of unknown risks. Moreover, they claim complete insurance in equilibrium to be impossible if beliefs are different. We show that even with different beliefs, firstly, complete insurance is possible in each statistical state, and secondly, contingent equilibrium can still be supported in economies with insurance and securities.
Materialart:
Digitale Medien
URL:
http://dx.doi.org/10.1023/A:1008745423609
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