Disaster Risk Financing through Taxation: A Framework for Regional Participation in Collective Risk-Sharing
Fuente:
arXiv
Saved in:
| Main Authors: | , , , |
|---|---|
| Format: | Preprint |
| Published: |
2025
|
| Subjects: | |
| Online Access: | |
| Tags: |
Add Tag
No Tags, Be the first to tag this record!
|
| _version_ | 1866918068247068672 |
|---|---|
| author | Niakh, Fallou Charpentier, Arthur Hillairet, Caroline Ratz, Philipp |
| author_facet | Niakh, Fallou Charpentier, Arthur Hillairet, Caroline Ratz, Philipp |
| contents | We consider an economy composed of different risk profile regions wishing to be hedged against a disaster risk using multi-region catastrophe insurance. Such catastrophic events inherently have a systemic component; we consider situations where the insurer faces a non-zero probability of insolvency. To protect the regions against the risk of the insurer's default, we introduce a public-private partnership between the government and the insurer. When a disaster generates losses exceeding the total capital of the insurer, the central government intervenes by implementing a taxation system to share the residual claims. In this study, we propose a theoretical framework for regional participation in collective risk-sharing through tax revenues by accounting for their disaster risk profiles and their economic status. |
| format | Preprint |
| id |
arxiv_https___arxiv_org_abs_2506_18895 |
| institution | arXiv |
| publishDate | 2025 |
| record_format | arxiv |
| spellingShingle | Disaster Risk Financing through Taxation: A Framework for Regional Participation in Collective Risk-Sharing Niakh, Fallou Charpentier, Arthur Hillairet, Caroline Ratz, Philipp Theoretical Economics Risk Management We consider an economy composed of different risk profile regions wishing to be hedged against a disaster risk using multi-region catastrophe insurance. Such catastrophic events inherently have a systemic component; we consider situations where the insurer faces a non-zero probability of insolvency. To protect the regions against the risk of the insurer's default, we introduce a public-private partnership between the government and the insurer. When a disaster generates losses exceeding the total capital of the insurer, the central government intervenes by implementing a taxation system to share the residual claims. In this study, we propose a theoretical framework for regional participation in collective risk-sharing through tax revenues by accounting for their disaster risk profiles and their economic status. |
| title | Disaster Risk Financing through Taxation: A Framework for Regional Participation in Collective Risk-Sharing |
| topic | Theoretical Economics Risk Management |
| url | https://arxiv.org/abs/2506.18895 |