Risk-sharing, adjustment, and trade
构建了一个小型开放经济中劳动力流动的动态模型，研究贸易条件波动下风险厌恶如何影响工人跨部门流动，并分析关税和自给自足政策对风险承担及社会福利的复杂影响。
We consider a dynamic model of labor mobility in a small open economy with stochastic terms of trade. Migration is costly and markets for labor income risk are absent. Risk-aversion slows down the movement of the most productive workers into the risky sector, and speeds up that of the least productive ones. The effect of tariffs and autarky on risk-bearing is examined. A given policy may improve social welfare for some initial conditions and lower it for others. Thus policy design for such an economy is context-specific and can be time-inconsistent.