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Consumption and Income Inequality in Sub-Saharan Africa: A Lifetime with No Humps and Low Partial Insurance

Author

Listed:
  • Raul Santaeulalia-Llopis

    (Washington University in St. Louis)

  • Leandro De Magalhaes

    (University of Bristol)

Abstract

We conclude that low partial insurance is the norm in the rural areas of SSA and that credit constraints, savings constraints, and imperfect enforceability with a high risk of default are good reasons for it. The one lesson that we are learning is that theories that incorporate credit constraints, savings constraints, and some degree of lack of commitment are the ones more suitable to understand the degree of consupmtion insurance in SSA and possibly growth in these contexts. We are currently pursuing a quantitative theory of that short.

Suggested Citation

  • Raul Santaeulalia-Llopis & Leandro De Magalhaes, 2014. "Consumption and Income Inequality in Sub-Saharan Africa: A Lifetime with No Humps and Low Partial Insurance," 2014 Meeting Papers 1287, Society for Economic Dynamics.
    • Handle: RePEc:red:sed014:1287
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    References listed on IDEAS

    as
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