The Federal Reserve Bank of New York works to promote sound and well-functioning financial systems and markets through its provision of industry and payment services, advancement of infrastructure reform in key markets and training and educational support to international institutions.
Regional & Community Outreach connects the Bank to Main Street via structured dialogues and two-way conversations on small business, mortgages, and household credit.
Economic Education improves public knowledge about the Federal Reserve System, monetary policy implementation, and promoting financial stability through the Museum and programs for K-16 students and educators, and the community.
We model an “anxious” agent as one who is more risk averse with respect to imminent risks than distant risks. Such horizon-dependent risk aversion preferences describe well-documented features of (i) individual behavior, (ii) equilibrium asset prices, and (iii) endogenously arising institutions. In particular, based on a utility function that captures individual subjects’ behavior in the lab, we predict a downward-sloping term structure of risk premia, and show that costly delegated portfolio management is a strategy to cope with dynamic inconsistency with respect to intra-temporal risk-return trade-offs.