Macro markets and financial security
Abstract: Uncertainty about national income growth poses significant macroeconomic risk to households all over the world. To help reduce investors' exposure, researchers have proposed a controversial new set of security markets called macro markets. These international markets would trade long-term claims on the income of an entire country or region. For example, in a macro market for the United States, an investor could buy a claim on the U.S. national income and then receive dividends equal to a fraction of national income for as long as the claim is held. Although many barriers stand in the way of the markets' development - including investors' focus on short-term portfolio performance, sizable startup costs, and contract enforcement difficulties - the potential benefits of these markets are great.
File(s): File format is text/html https://www.newyorkfed.org/medialibrary/media/research/epr/99v05n1/9904atha.html
File(s): File format is application/pdf https://www.newyorkfed.org/medialibrary/media/research/epr/99v05n1/9904atha.pdf
Provider: Federal Reserve Bank of New York
Part of Series: Economic Policy Review