@article{94bb57a5be2749d6b081172ee91a0749,
title = "Risk and the allocation of talent in the Roy model",
abstract = "With risk-averse workers and uninsurable earnings shocks, competitive markets allocate too few workers to risky jobs. Using an equilibrium Roy model with incomplete markets, we show that in competitive equilibrium, risky occupations are inefficiently small and hence talent is misallocated.",
keywords = "511 Economics, Incomplete markets, Misallocation, Occupations, Risk, Roy model",
author = "German Cubas and Pedro Silos and Vesa-Heikki Soini",
note = "Funding Information: We thank the editor and an anonymous referee. We also thank participants of different conferences and venues where the paper was presented and specially, Dante Amengual, Juan Dubra, Max Dvorkin, Steve Craig, Kevin Donovan, Andres Erosa, Rafael Guntin, Chris Herrington, Erik Hurst, Joe Kaboski, Alexander Ludwig, Bent Sorensen, and Felix Wellschmied for their detailed and insightful comments. Publisher Copyright: {\textcopyright} 2024 Elsevier B.V. Publisher Copyright: {\textcopyright} 2024 Elsevier B.V.",
year = "2024",
month = mar,
day = "4",
doi = "10.1016/j.econlet.2024.111623",
language = "English",
volume = "236",
journal = "Economics Letters",
issn = "0165-1765",
publisher = "Elsevier BV",
}