Assessing the Degree of International Consumption Risk Sharing

This paper examines the extent of consumption risk sharing for a group of 50 high-income and developing countries. The analysis is based on the empirical implementation of a model of partial consumption insurance whose parameters have the natural i...

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Main Authors:	Hevia, Constantino, Serven, Luis
Format:	Working Paper
Language:	English en_US
Published:	World Bank, Washington, DC 2016
Subjects:	insurance risk management risk sharing consumption risk financial globalization foreign assets foreign debt
Online Access:	http://documents.worldbank.org/curated/en/2016/10/26875134/assessing-degree-international-consumption-risk-sharing http://hdl.handle.net/10986/25312

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recordtype	oai_dc
spelling	okr-10986-253122021-06-14T10:16:43Z Assessing the Degree of International Consumption Risk Sharing Hevia, Constantino Serven, Luis insurance risk management risk sharing consumption risk financial globalization foreign assets foreign debt This paper examines the extent of consumption risk sharing for a group of 50 high-income and developing countries. The analysis is based on the empirical implementation of a model of partial consumption insurance whose parameters have the natural interpretation of coefficients of partial risk sharing even when the 0 hypothesis of perfect risk sharing is rejected. The estimation results show that high-income countries exhibit higher degrees of risk sharing than developing countries, and that the gap between the two country groups appears to have widened over the period of financial globalization. Moreover, the pattern of consumption risk sharing is related to the degree of financial openness: countries with more open capital accounts, and larger stocks of foreign assets and liabilities exhibit larger degrees of risk sharing. Yet, larger countries in terms of gross domestic product show lower degrees of consumption risk sharing. 2016-11-01T18:50:48Z 2016-11-01T18:50:48Z 2016-10 Working Paper http://documents.worldbank.org/curated/en/2016/10/26875134/assessing-degree-international-consumption-risk-sharing http://hdl.handle.net/10986/25312 English en_US Policy Research Working Paper;No. 7867 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English en_US
topic	insurance risk management risk sharing consumption risk financial globalization foreign assets foreign debt
spellingShingle	insurance risk management risk sharing consumption risk financial globalization foreign assets foreign debt Hevia, Constantino Serven, Luis Assessing the Degree of International Consumption Risk Sharing
relation	Policy Research Working Paper;No. 7867
description	This paper examines the extent of consumption risk sharing for a group of 50 high-income and developing countries. The analysis is based on the empirical implementation of a model of partial consumption insurance whose parameters have the natural interpretation of coefficients of partial risk sharing even when the 0 hypothesis of perfect risk sharing is rejected. The estimation results show that high-income countries exhibit higher degrees of risk sharing than developing countries, and that the gap between the two country groups appears to have widened over the period of financial globalization. Moreover, the pattern of consumption risk sharing is related to the degree of financial openness: countries with more open capital accounts, and larger stocks of foreign assets and liabilities exhibit larger degrees of risk sharing. Yet, larger countries in terms of gross domestic product show lower degrees of consumption risk sharing.
format	Working Paper
author	Hevia, Constantino Serven, Luis
author_facet	Hevia, Constantino Serven, Luis
author_sort	Hevia, Constantino
title	Assessing the Degree of International Consumption Risk Sharing
title_short	Assessing the Degree of International Consumption Risk Sharing
title_full	Assessing the Degree of International Consumption Risk Sharing
title_fullStr	Assessing the Degree of International Consumption Risk Sharing
title_full_unstemmed	Assessing the Degree of International Consumption Risk Sharing
title_sort	assessing the degree of international consumption risk sharing
publisher	World Bank, Washington, DC
publishDate	2016
url	http://documents.worldbank.org/curated/en/2016/10/26875134/assessing-degree-international-consumption-risk-sharing http://hdl.handle.net/10986/25312
_version_	1764458933581250560

Assessing the Degree of International Consumption Risk Sharing

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