percent of mean income. In this paper we use economic theory to determine the relation between the appropriate make …-whole (full) compensation and mean and median work incomes. Given that consumption uncertainty associated with compensation …

This paper analyzes the optimal response of the social insurance system to a rise in labor market risk. To this end, we … develop a tractable macroeconomic model with risk-free physical capital, risky human capital (labor market risk) and … (human capital) risk increases social welfare if the government adjusts the tax-and-transfer system optimally. Finally, we …

policy relevant outcomes and policy effects, that of the wage premia for fatal injury risk. Estimates of the overall hedonic …

model with idiosyncratic labor income risk. In our model economy, even a moderate earnings testing reduces individuals …

We estimate the changes in US male labor market risk over the last three decades in a model of endogenous labor supply … a life-cycle model with search frictions, we show that the estimated changes in risk can account for 85 percent of the … increase in within group wage inequality. The welfare costs of rising risk are small. …

substantial. The second result is that true wage risk is almost three times as large as the wage variance observed after job … mobility, which is what other papers in the literature have called wage risk. This suggests a very different picture of the …

Microeconomic theory predicts that under certain regularity conditions higher idiosyncratic risk increases the … propensity to insure against independent marketable risks. We apply these predictions to the specific case of labor income risk … and car insurance using data from the UK. The main empirical results are: - higher labor income risk induces a higher …

We study workers' idiosyncratic earnings risk over the life-cycle using a German administrative data set. Positive and … incomplete markets model. Moreover, age-varying risk implies a linear increase in consumption inequality late in working life. …