Journal Article

Self-Insurance and the Risk-Sharing Role of Money

Abstract: Overcoming the lack of coincidence of wants is a well-acknowledged role of money. In this review, I illustrate that the use of money also promotes risk-sharing in the society: when individuals hold money, it helps other individuals mitigate their own liquidity risks.

Keywords: self-insurance; money; toy model; risk-sharing;

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Bibliographic Information

Provider: Federal Reserve Bank of Richmond

Part of Series: Economic Quarterly

Publication Date: 2018

Issue: 1Q

Pages: 35-52