Incentive constraints and the pattern of international risk sharing

SCW (Sylvester) Eijffinger, Wolf Wagner

Research output: Contribution to journalArticleAcademicpeer-review

1 Citation (Scopus)


This paper analyzes the implications of moral hazard and a lack of contract enforcement for risk sharing across countries and regions. We demonstrate that both incentive problems can considerably restrict efficient risk sharing. However, we show that the cross-sectional risk sharing component is much more affected than the intertemporal component. We argue that this may help to explain several stylized facts of international risk sharing, such as the low degree of insurance against permanent shocks
Original languageEnglish
Pages (from-to)1206-1225
Number of pages20
JournalJournal of International Money and Finance
Issue number7
Publication statusPublished - 2010


Dive into the research topics of 'Incentive constraints and the pattern of international risk sharing'. Together they form a unique fingerprint.

Cite this