Sorensen, Bent E.2019-09-152019-09-15May 20142014-05May 2014https://hdl.handle.net/10657/4678This study is devoted to the analysis of consumption-risk sharing and income inequality among Taiwanese households. In the first part of this study, I examine risk sharing during 1985-2006. I show that household-head income of low-education cohorts declined while those of higher education cohorts increased during 1997-2001; by comparison, both higher and low-education cohorts experienced similar growth in household-head income during 1985-1994 and 2002-2006. Therefore, I ask the question that whether these changes in relative growth in household-head income affected household consumption. Full risk sharing predicts that growth in household consumption should not be affected by idiosyncratic shocks to household-head income because the households could share risk through various channels such as transfers and the financial markets. Full risk sharing was rejected among Taiwanese households during 1985-2006. Nevertheless, more than sixty percent of the households' consumption risk was insured during this period. In addition, the level of risk sharing was higher during 1997-2001 when compared to that during 2002-2006. I decompose the risk-sharing channels into sub-periods and find that a drop in the amount of risk sharing achieved through income of household members was the main reason that risk-sharing during 2002-2006 was weaker than that during 1997-2001. In the second part of this study, I examine the changes in the individual and household-level income inequality. On the individual level, the difference in the average wage between male and female workers was shrinking during 1980-2011. In addition, the changes in the gender wage differences were more important than those in wage differences across education or age groups in explaining the changes in the individual-level inequality. On the household level, I show that household-income inequality was increasing in Taiwan in the late-1990s. Nevertheless, net private transfers and net cash benefits from social insurances lowered the household-level income inequality.application/pdfengThe author of this work is the copyright owner. UH Libraries and the Texas Digital Library have their permission to store and provide access to this work. Further transmission, reproduction, or presentation of this work is prohibited except with permission of the author(s).Risk-sharingConsumptionIncome2019-09-15Thesisborn digital