A survey of empirical studies on international risk sharing

Journal title QA Rivista dell’Associazione Rossi-Doria
Author/s Eleonora Pierucci
Publishing Year 2014 Issue 2014/2
Language Italian Pages 38 P. 7-44 File size 188 KB
DOI 10.3280/QU2014-002001
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A Survey of Empirical Studies on International Risk Sharing Risk sharing among countries is desirable since it enables economic agents to smooth consumption across time and states of nature, partially or completing offsetting the impact of income shocks on consumption choices. The aim of this work is systematically to survey the most relevant literature on international risk sharing mainly focusing on empirical contributions. The current lively debate on the impact of globalization in the form of financial integration over risk sharing is also surveyed. From a theoretical point of view there are two main approaches to risk diversification, respectively based on: consumption theory and portfolio choices. In this survey we will consider that strand of the literature theoretically founded on consumption theory and within this approach we take bearings on the extensive and fragmented empirical literature. EconLit Classification: E210, F410, F620, G100

Keywords: Consumption smoothing, International risk sharing, Financial integration

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Eleonora Pierucci, A survey of empirical studies on international risk sharing in "QA Rivista dell’Associazione Rossi-Doria" 2/2014, pp 7-44, DOI: 10.3280/QU2014-002001