| Budget Amount *help |
¥2,470,000 (Direct Cost: ¥1,900,000、Indirect Cost: ¥570,000)
Fiscal Year 2014: ¥1,170,000 (Direct Cost: ¥900,000、Indirect Cost: ¥270,000)
Fiscal Year 2013: ¥1,300,000 (Direct Cost: ¥1,000,000、Indirect Cost: ¥300,000)
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| Outline of Final Research Achievements |
Not only changes in prices and quantity but also those in the number of product varieties and quality can be a source of consumption risk. What would be then the nature of international risk sharing in the presence of such consumption risk induced by changes in product quality and the number of product varieties? In this research, first we successfully reproduce a positive correlation between price of exporting goods and its product quality as observed in the data. Second, we analytically show that the possibility of perfect risk sharing as we obtain with complete financial markets even without any international borrowing and lending. Finally, our theoretical model successfully reproduce the observed correlation between relative consumption across countries and the real exchange rate.
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