Collective risk aversion In this paper we analyse the risk attitude of a group of heterogenous agents and we develop a theory of comparative collective risk tolerance. In particular, we characterize how shifts in the distribution of individual levels of risk tolerance affect the representative agentu0027s degree of risk tolerance. In the model with efficient risk  sharing and two agents (e.g. a household) with isoelastic preferences we show that an increase of the level of risk tolerance of one of the agents might have an ambiguous impact on the aggregate level of risk tolerance; the latter increases for some levels of aggregate wealth while it decreases for other levels of aggregate wealth. Specifically, there are two possible shapes for aggregate risk tolerance as a function of the risk tolerance level of one of the agents: increasing curve or increasing then decreasing curve. For more general populations we characterize the effect of first order like shifts (individual levels of risk tolerance more concentrated on high values) and second order like shifts (more dispersion on individual levels of risk tolerance) on the collective level of risk tolerance. We also evaluate how shifts in the distribution of individual levels of risk tolerance impact the collective level of risk tolerance in a framework with exogenous egalitarian sharing rules. Our results permit to better characterize differences in risk taking behavior between groups and individuals and among groups with different distribution of risk preferences.

Evolutionary Game Analysis of Pollutant Abatement with CollectiveRisk This paper examines strategies of asymmetric enterprises in joint pollutant abatement with collectiverisk. Asymmetric enterprises are divided into two types: one type with high initial resource endowments, the other with low initial resource endowments. Evolutionary dynamics in two distinct scenarios namely fair contribution and altruistic preference are analyzed. The paper proves that enterprises with high initial endowments have greater incentives to cooperate, and are more likely to be altruistic agents. Moreover, effects of increment of risk rate on cooperation are two sided. A large group size of enterprises hinders the prevalence of cooperation and weakens punitive tax rateu0027s role in promoting cooperation. Whereas broadening the gap of resource endowments between enterprises can effectively reduce the occurrence of defection. Whether those with low initial resource endowments will participate in joint pollutant abatement depends on if there are cooperators in enterprises with high initial endowments.