China's economy underwent a steady recovery in 2021. Investment grew steadily with structural improvement. Exports and imports surged while trade surplus expanded. On the other hand, although labor market conditions improved, income distribution worsened, contributing to sluggish growth in...

We build a model in which financial intermediaries provide insurance to households against a liquidity shock. Households can also invest directly on a financial market if they pay a cost. In equilibrium, the ability of intermediaries to share risk is constrained by the market. This can be...