Risk Sharing, Optimal Market Integration and Financial Contagion

2016 Fiscal Year Final Research Report

• Project/Area Number: 25780206
• Research Category: Grant-in-Aid for Young Scientists (B)
• Allocation Type: Multi-year Fund
• Research Field: Money/ Finance
• Research Institution: Meiji Gakuin University
• Principal Investigator: OHNO Hiroaki 明治学院大学, 経済学部, 准教授 (20554934)
• Co-Investigator(Renkei-kenkyūsha): SUGAWARA Kouki 名古屋学院大学, 経済学部, 准教授 (80581503)
• Project Period (FY): 2013-04-01 – 2017-03-31
• Keywords: 最適市場統合の規模 / 内生的生産性ショック / 流動化技術 / 選好ショック / 財の多様性 / 金融仲介機関 / 危険回避係数

Outline of Final Research Achievements

The objectives of analyses to offer some theoretical rationale behind market segmentation, and also for the delay in and insufficient promotion of R&D investment in partial developing countries. First, I investigate the relation risk aversion, endogenous productivity risks, and spillovers from integrated markets. In case of high risk aversion, there is a unique equilibrium in which partial market integration contributes to growth and social welfare. Second, We investigate the effect of lifetime risks on economic growth by incorporating preference shocks into a variety-expansion model and comparing financial autarky and financial intermediaries. Our results suggest that when risk aversion is high, an increase in number of differentiated goods slows down R&D investment through a decrease in the price index. Further, if the risk of early withdrawal and the liquidation cost of long-term investment are high, financial intermediaries have significant effects on the growth of variety.

Free Research Field

金融経済学