Risk Sharing Research Articles

Social Status, Portfolio Externalities, and International Risk Sharing

We show that a model of “the spirit of capitalism”, or the concern for social status, can generate a high degree of international risk sharing as measured by asset prices, even when consumption and portfolio holdings exhibit “home bias”. We also show how portfolio externalities can arise in the model and highlight the caution that one needs in interpreting asset-price-based measures of international risk sharing: in the presence of portfolio externalities, even when the measured degree of risk sharing is perfect, it is still possible for government policies to induce investors to hold better-diversified portfolios and attain higher welfare.

Disclosure and Dynamic Risk Sharing with a Large Shareholder

ABSTRACT We study the effects of disclosure in a dynamic market with imperfect competition. The supply of an asset is determined by a large shareholder with price impact, who trades slowly to diversify away from concentrated ownership. Small investors provide capital and thus risk-bearing capacity to the market. Although it is well known that disclosure impedes risk sharing by shifting risk before future trading opportunities, we show that disclosure, at the same time, can enhance risk sharing by promoting more trades. Resolving this tradeoff, an interior level of disclosure quality maximizes the small investors’ surplus as well as the total surplus, but minimizes the large shareholder’s surplus. Further, efficient disclosure policies feature increasing quality over time. JEL Classifications: D80; E21; G12; L13; M41.

Quantitative tracing of typical herbicides and their metabolites in sorghum agrosystems for fate tendency and cumulative risk

Elucidating the combined exposure of agrochemicals is essential for safeguarding human health and agroecosystem safety. A rapid and high-sensitivity UHPLC-MS/MS method was developed for simultaneous quantification of nine compounds in sorghum by an assembly-line optimization process with a limit of quantitation of 0.001 mg/kg. The concentration variation of atrazine, quinclorac, fluroxypyr-meptyl and metabolites was reflected by terminal magnitudes of ≤0.0665 mg/kg. Additionally, atrazine was dealkylated to deethyl atrazine and desethyl desisopropyl atrazine at concentrations of 0.0014–0.0058 mg/kg during the sorghum harvest. Acceptable health hazardous of atrazine and quinclorac for all life cycle populations were comparatively assessed via deterministic and probabilistic models, in which atrazine gained an 83.55 % share of cumulative dietary risks. Rural residents had significantly higher risks than urban residents, and children were the most sensitive group. Despite the low health risks, combined exposure to herbicides and their metabolites should be continuously stressed, given their cumulative amplification effects.

The Impact of the Belt and Road Initiative on International Consumption Risk Sharing: A Difference-in-Differences Analysis

This study investigates the impact of the Belt and Road Initiative (BRI) on consumption risk sharing among participating countries. Utilizing a difference-in-differences model within the context of international consumption risk sharing, we analyze data from 2002 to 2022 for 64 BRI countries. Our empirical findings indicate a significant reduction in consumption risk sharing attributable to the BRI. Further subgroup analysis reveals that the BRI hinders consumption risk sharing particularly among countries along the Land Silk Road, especially those bordering China. Key contributing factors include increased tariffs, heightened foreign investment, rising employment rates, increased resident income, and a diversified range of consumer products. These factors exacerbate the BRI’s adverse effects on consumption risk sharing in comparison to countries with lower levels of these variables. Our findings suggest that the Initiative has an uneven impact on the mechanisms affecting countries along its route.

Conditional Mean Risk Sharing of Independent Discrete Losses in Large Pools

Conditional Mean Risk Sharing of Independent Discrete Losses in Large Pools

Role of Ultrasonography in the Diagnosis of Acute Appendicitis

Introduction: Acute appendicitis is still prevalent as a major surgical emergency. Due to the fast progress of the ailment, surgery is often the most sensible approach to manage it. But any surgery comes with its fair share of risk. If the diagnosis of the disease can be made more accurate prior to surgery, the error rate of negative appendectomy can be greatly reduced. Aim of the study: The aim of the study was to evaluate the role of ultrasonography in the diagnosing acute appendicitis. Methods: This prospective cross-sectional study was conducted at the Institute of Nuclear Medicine & Allied Sciences (INMAS), Rangpur with Department of Surgery & Department of Pathology of Rangpur Medical College Hospital, Rangpur, Bangladesh. The study duration was 02 years, from 01January 2022 to 31 December 2023. A total of 100 cases were selected from those patients were come for ultrasound examination, send from the hospital with pain in the right lower quadrant of the abdomen for the purpose of this study. Result: Among the 100 participants of the study, histopathological diagnosis showed that 86% were acute appendicitis cases and 14% had normal appendicitis. Gender or age had no significant association with histopathological diagnosis, but male prevalence was observed in the study, with a high prevalence of young adults. The original site of pain was periumbilical pain shifted to the right iliac fossa for half the participants. Pain duration was between 18-24 hours for 36% of the cases. All participants presented with pain, fever, anorexia, and nausea had a high prevalence among participants. The sensitivity and specificity of high-resolution ultra-sonogram were 84.9% and 85.7% respectively. Conclusion: Appendicitis is a disease of the young, and can occur in participants of both genders. Histopathological diagnosis has no significant association with patient age or gender. Ultra-sonogram has high sensitivity and specificity ratio in diagnosing acute appendicitis and also h

Fiscal Risk Sharing in China: Is It Significant and How to Further Improve It?

Fiscal Risk Sharing in China: Is It Significant and How to Further Improve It?

Quantitative Analysis of Agricultural Programmes’ Effectiveness in Reducing Unemployment Rate in Nigeria

Unemployment remains a pressing issue in Nigeria, with a significant portion of its population unable to secure sustainable employment opportunities. In recent years, agricultural programmes have emerged as potential solutions to address the challenges of unemployment. This study explores the effectiveness of agricultural programmes in reducing unemployment rate in Nigeria. The agricultural sector in Nigeria holds immense potential for job creation, considering the country’s vast arable land, favourable climate, and agricultural resources. However, the sector has been underutilized and faced numerous challenges, leading to high unemployment rates. Agricultural programmes have garnered attention as they aim to revitalize the sector, promote sustainable farming practices, and create employment opportunities for the burgeoning youth population. Consequently, the paper examines the impact of key agricultural programmes such as the Commercial Agriculture Credit Scheme (CACS), Agricultural Credit Guarantee Scheme (ACGS), Nigerian Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL), and FADAMA, introduced by successive Nigerian governments at various times in reducing the unemployment rate in the country. Some of these programme though new, are just a transmutation from older ones, with the operations remaining the same. These programmes have demonstrated positive impacts in several ways according to statistics; contributing to the diversification of the economy of Nigeria and reducing the country’s heavy reliance on oil revenue. The question is, how effective have these programmes been in reducing the unemployment rate? Therefore, the paper’s main objective was to analyse how successful these programmes have been in checking the problem. The study uses the Logit model to investigate the effectiveness of these key Agricultural programmes in curbing the unemployment rate in the country. Data from the Central Bank of Nigeria (CBN) and the National Bureau of Statistics (NBS) were used in the analysis. The results reveal that, of the four prominent programmes introduced by the government based on participants employed, the Commercial Agriculture Credit Scheme (CACS) had the likelihood or greater probability at reducing the unemployment rate in the country. The study, consequently, concludes that, subsequent programmes should be designed according to the operations and modus operandi of CACS and that other programmes should either be upgraded to CACS module or be scrapped since their impact on reducing unemployment is not felt.

Modeling Risk Sharing and Impact on Systemic Risk

This paper develops a simplified agent-based model to investigate the dynamics of risk transfer and its implications for systemic risk within financial networks, focusing specifically on credit default swaps (CDSs) as instruments of risk allocation among banks and firms. Unlike broader models that incorporate multiple types of economic agents, our approach explicitly targets the interactions between banks and firms across three markets: credit, interbank loans, and CDSs. This model diverges from the frameworks established by prior researchers by simplifying the agent structure, which allows for more focused calibration to empirical data—specifically, a sample of Swiss banks—and enhances interpretability for regulatory use. Our analysis centers around two control variables, CDSc and CDSn, which control the likelihood of institutions participating in covered and naked CDS transactions, respectively. This approach allows us to explore the network’s behavior under varying levels of interconnectedness and differing magnitudes of deposit shocks. Our results indicate that the network can withstand minor shocks, but higher levels of CDS engagement significantly increase variance and kurtosis in equity returns, signaling heightened instability. This effect is amplified during severe shocks, suggesting that CDSs, instead of mitigating risk, propagate systemic risk, particularly in highly interconnected networks. These findings underscore the need for regulatory oversight to manage risk concentration and ensure financial stability.

The Flight to Safety and International Risk Sharing

We study a business cycle model of the international monetary system featuring a time-varying demand for safe dollar bonds, greater risk-bearing capacity in the United States than the rest of the world, and nominal rigidities. A flight to safety generates a dollar appreciation and decline in global output. Dollar bonds thus command a negative risk premium, and the United States holds a levered portfolio of capital financed in dollars. We quantify the effects of safety shocks and heterogeneity in risk-bearing capacity for global macroeconomic volatility, US external adjustment, and policy transmission, as of dollar swap lines. (JEL E32, E43, E44, E52, F44, G11, G15)

Flood Risk Exposures and Mortgage-Backed Security Asset Performance and Risk Sharing

Flood Risk Exposures and Mortgage-Backed Security Asset Performance and Risk Sharing

Determining the range of negotiable prices for public–private partnership infrastructure projects: a simulation approach

PurposeThis research aims to measure the public sector comparator (PSC) to reach public–private partnership (PPP) projects' negotiable price range for water and sewage companies in Iran. PSC measurement drives the public sector to make valid decisions about costs.Design/methodology/approachAround 170 risks were primarily determined through studying numerous articles. Then, risk effects were specified by distributing questionnaires in two steps. The questionnaires are distributed among experts on PPP-related projects and the Monte Carlo simulation method is used for confidence factors of 70, 80 and 90%. PSC is measured based on these results to study cases of Sirjan’s sewerage and sewage purification systems.Findings11 risks were identified as the main risks that are effective on PSC, and project implementation costs were specified based on the modeling. The corruption of the private and public sectors was identified as the most effective risk in this research. It can affect a project’s cost up to 158% in the construction period and up to 134% in the operation period. Based on the obtained results, 63% of this risk’s cost goes to the public sector.Originality/valueThe originality of this research is the PSC measurement method and appointing the risk share of each private and public sector. The results of this research can be applied to all the infrastructure and PPP projects in Iran and other developing countries as a way for employers to estimate accurate negotiable price ranges.

Outsourcing in the Form of Risk Sharing and Staff Commitment Among Employees in Shell Petroleum Development Company (SPDC) Between 2018 – 2023

Outsourcing in the Form of Risk Sharing and Staff Commitment Among Employees in Shell Petroleum Development Company (SPDC) Between 2018 – 2023

Separating Equilibria with Search and Selection Effort: Evidence from the Auto Insurance Market

The objective of this paper is to assess the behavior of policyholders and insurance companies in the presence of adverse selection by accounting for costly search and selection efforts, respectively. Insurers seek to stave off high-risk types, while consumers are hypothesized to maximize coverage at a given premium. Reaction functions are derived for the two players giving rise to Nash equilibria in efforts space, which are separating almost certainly regardless of the share of low risks in the market. Empirical evidence from the Australian market for automobile insurance is analyzed using Structural Equation Modeling. Convergence has been achieved with both the developmental and test samples. Both consumer search and insurer selection are found to be positively correlated with risk type, providing a good measure of empirical support for the theoretical model.

Hygienic estimation of working conditions and hazard indices for persons involved in the application of pesticides on berries and melon cultures in the conditions of personal peasant farms

the problems of environmental protection and chemical safety of agricultural workers when working with pesticides are urgent. The assessment of working conditions is a mandatory component to substantiate the principles of risk management of their possible adverse impact on employees. The purpose of the work: conducting a hygienic assessment of working conditions and risks for people who process berry and melon crops with Amistar Gold, Topaz, Uniform, Rydomil Gold, Dual Gold, Vertimek in the private sector, and also substantiation of the regulations for the safe use of these pesticides. Field studies were conducted in Ukraine's different soil and climate regions. The assessment of the danger index (risk) for workers was carried out using data on the content of the studied active substances in the air of the working area and levels of skin contamination following MR 8.8.1.4-162-2009 "Study, assessment and reduction of the risk of inhalation and percutaneous exposure...". Statistical processing of the results was carried out using EZR v. 1.55, MedStat v. 5.2. Аs a result of field studies conducted with the Amistar Gold, Topaz, Uniform, Ridomil Gold, Dual Gold, Vertimek pesticides, no exceedances of hygienic standards were found in the air of the working area and the air above the treated area and in the area of possible aerial drift of the pesticides. Values of percutaneous risk for operators were from 0.00007±0.00005 to 0.069±0.044, inhalation – ranged 0.000003±0.0000025 to 0.005±0.0025, total –0.0001±0.00005 to 0.069 ±0.044, combined – 0.010±0.0016 to 0.017±0.0028. The share of percutaneous risk for operators was in the range of 47.3-99.9%. After analyzing the obtained results, it can be concluded that the percutaneous, inhalation, total and combined risks during knapsack treatment with fungicides Amistar Gold, Topaz, Uniform, Rydomil Gold, herbicide Dual Gold and insecticide Vertimek in the private sector are less than 1, i.e., do not exceed the permissible limit.

Optimal Risk Sharing for Maxmin Choquet Expected Utility Model

Optimal Risk Sharing for Maxmin Choquet Expected Utility Model

A Theory of the Term Structure of Interest Rates under Limited Household Risk Sharing

Abstract We present a theory in which the interaction between limited sharing of idiosyncratic labor income risk and labor adjustment costs (that endogenously arise through search frictions) determines interest rate dynamics. In the general equilibrium, the interaction of these two ingredients relates bond risk premiums, cross-sectional skewness of income growth, and labor market tightness. Our model rationalizes an upward-sloping average yield curve and predicts a negative relation between labor market tightness and bond risk premiums. We provide evidence for our theory’s mechanism and predictions.

Safety Wearable for Miners

INTRODUCTION: Mining is the process of extraction of valuable minerals, ores and other non-renewable resources from the Earth’s surface. The mining industry is known for its hazardous and highly risky working environment. OBJECTIVES: The mining industry is involved in the extraction of these geological materials, which is essential for the development of the country and its economy. However, this industry comes with its fair share of risks and dangers. Recent statistics show that around 100 miners fall victim to the harsh working conditions every year. METHODS: Explosions due to Methane and coal dust followed by roof collapses, mine fires, gas outburst, blasting accidents, poisoning and suffocation are the major reasons out of these few of them causes deaths inside the mines. RESULTS: Even though many precautions are suggested, and measures have been taken to improve the safety of the miners and to improve the work environment, but mines are still unpredictable, and accidents are also recorded then and there. CONCLUSION: The existing safety technologies and measures have either failed to monitor multiple vital features that could lead to fatalities, or to provide adequate and appropriate rescue resources in time to help the miners in danger.

Financial inclusion and impacts on agriculture in Delta State, Nigeria

The study appraised financial inclusion and impacts on agriculture in Delta State, Nigeria. Delta State, located in the southern region of Nigeria, is known for its rich agricultural potential. Agriculture is a major source of livelihood for the majority of its population, contributing significantly to both food security and economic growth. Nigeria introduced National Financial Inclusion Strategy (NFIS) in 2012. Besides, interventions of financial inclusion packages in Nigeria by some corporate financial inclusion organizations include: Agent Banking and Mobile Money, Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL), Financial Literacy and Education Programs, Agricultural Credit Guarantee Scheme Fund (ACGSF) and Microfinance Institutions (MFIs). These organizations impacted the Delta State agriculture in the areas of cassava farming, oil palm production, rice cultivation, poultry, fisheries and aquaculture, agribusiness and processing and agricultural diversity. Such Impacts were obvious in food security, poverty reduction, women's empowerment, market access and value chain integration, risk mitigation, access to agricultural inputs, income diversification and increased agricultural productivity. Noticeable financial inclusion challenges in Delta State's agricultural sector were limited access to financial services, insufficient financial literacy programmes and inadequate rural infrastructure. It was concluded that financial inclusion in agriculture in Delta State is a cornerstone for the state's economic development and the well-being of its citizens. Among the recommendations given, it was emphasized that strengthening financial education system should be prioritized in agriculture.

Risk Sharing with Lambda Value at Risk

In this paper, we study the risk-sharing problem among multiple agents using lambda value at risk ([Formula: see text]) as their preferences via the tool of inf-convolution, where [Formula: see text] is an extension of value at risk ([Formula: see text]). We obtain explicit formulas of the inf-convolution of multiple [Formula: see text] with monotone Λ and explicit forms of the corresponding optimal allocations, extending the results of the inf-convolution of [Formula: see text]. It turns out that the inf-convolution of several [Formula: see text] is still a [Formula: see text] under some mild condition. Moreover, we investigate the inf-convolution of one [Formula: see text] and a general monotone risk measure without cash additivity, including [Formula: see text], expected utility, and rank-dependent expected utility as special cases. The expression of the inf-convolution and the explicit forms of the optimal allocation are derived, leading to some partial solution of the risk-sharing problem with multiple [Formula: see text] for general Λ functions. Finally, we discuss the risk-sharing problem with [Formula: see text], another definition of lambda value at risk. We focus on the inf-convolution of [Formula: see text] and a risk measure that is consistent with the second-order stochastic dominance, deriving very different expression of the inf-convolution and the forms of the optimal allocations.