Matching to share risk

We consider a matching model in which individuals belonging to two populations (“males” and “females”) can match to share their exogenous income risk. Within each population, individuals can be ranked by risk aversion in the Arrow–Pratt sense. The model permits nontransferable utility, a context in which few general results have previously been derived. We show that in this framework a stable matching always exists, it is generically unique, and it is negatively assortative: for any two matched couples, the more risk averse male is matched with the less risk averse female.