
Risk-sharing networks
Publication
, Journal Article
Bramoullé, Y; Kranton, R
Published in: Journal of Economic Behavior and Organization
November 1, 2007
This paper considers the formation of risk-sharing networks. Following empirical findings, we build a model where pairs form links, but a population cannot coordinate links. As a benchmark, individuals commit to share monetary holdings equally with linked partners. We find efficient networks can (indirectly) connect all individuals and involve full insurance. But equilibrium networks connect fewer individuals. When breaking links, individuals do not consider negative externalities on others in the network. Thus identical individuals can end up in different positions in a network and have different outcomes. These results may help to explain empirical findings that risk-sharing is often asymmetric. © 2007.
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Published In
Journal of Economic Behavior and Organization
DOI
ISSN
0167-2681
Publication Date
November 1, 2007
Volume
64
Issue
3-4 SPEC. ISS.
Start / End Page
275 / 294
Related Subject Headings
- Economics
- 1403 Econometrics
- 1402 Applied Economics
- 1401 Economic Theory
Citation
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Bramoullé, Y., & Kranton, R. (2007). Risk-sharing networks. Journal of Economic Behavior and Organization, 64(3-4 SPEC. ISS.), 275–294. https://doi.org/10.1016/j.jebo.2006.10.004
Bramoullé, Y., and R. Kranton. “Risk-sharing networks.” Journal of Economic Behavior and Organization 64, no. 3-4 SPEC. ISS. (November 1, 2007): 275–94. https://doi.org/10.1016/j.jebo.2006.10.004.
Bramoullé Y, Kranton R. Risk-sharing networks. Journal of Economic Behavior and Organization. 2007 Nov 1;64(3-4 SPEC. ISS.):275–94.
Bramoullé, Y., and R. Kranton. “Risk-sharing networks.” Journal of Economic Behavior and Organization, vol. 64, no. 3-4 SPEC. ISS., Nov. 2007, pp. 275–94. Scopus, doi:10.1016/j.jebo.2006.10.004.
Bramoullé Y, Kranton R. Risk-sharing networks. Journal of Economic Behavior and Organization. 2007 Nov 1;64(3-4 SPEC. ISS.):275–294.

Published In
Journal of Economic Behavior and Organization
DOI
ISSN
0167-2681
Publication Date
November 1, 2007
Volume
64
Issue
3-4 SPEC. ISS.
Start / End Page
275 / 294
Related Subject Headings
- Economics
- 1403 Econometrics
- 1402 Applied Economics
- 1401 Economic Theory