Risk Sharing and Network Formation
In this article the authors examine the motivation behind the formation of risk pools. They do so by using as suitable study data survey information collected among the rural poor of the Philippines. They discuss the possibility that network formation comes as the result of an attempt to maximize gains derived from shared risk to income within a social group. They note that the most significant benefits of pooled risk occur when individuals are of different occupations and there is a variety of risks faced.
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|Date of creation:||May 2007|
|Date of revision:|
|Publication status:||Published in The American Economic Review, 2007, Vol. 97, no. 2. pp. 75-79.Length: 4 pages|
|Contact details of provider:|| Web page: http://www.dauphine.fr/en/welcome.html|
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- Ethan Ligon & Jonathan P. Thomas & Tim Worrall, 1997.
"Informal Insurance Arrangements in Village Economies,"
Keele Department of Economics Discussion Papers (1995-2001)
97/08, Department of Economics, Keele University, revised Oct 2000.
- Ethan Ligon & Jonathan P Thomas & Tim Worrall, 1997. "Informal Insurance Arrangements in Village Economies," CRIEFF Discussion Papers 9705, Centre for Research into Industry, Enterprise, Finance and the Firm.
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