Showing 1 - 10 of 68
How far can shoe-leather go in explaining the welfare cost of inflation? Using a unique set of microeconomic data on households, we estimate the parameters of the demand for money derived from a generalized Baumol-Tobin model. Our data set contains information on average holdings of cash, on...
Persistent link: https://www.econbiz.de/10005750381
The theory of intertemporal choice predicts that the cross-sectional variance of the marginal utility of consumption is equal to its own lag plus a constant and a random component. Using general preference specifications and some assumptions about the nature of the random component, we provide...
Persistent link: https://www.econbiz.de/10005626728
Prior research suggests that those who rely on intuition rather than effortful reasoning when making decisions are less averse to risk and ambiguity. The evidence is largely correlational, however, leaving open the question of the direction of causality. In this paper, we present experimental...
Persistent link: https://www.econbiz.de/10010801000
Using a representative sample of Italian investors, we estimate the risk associated with pension benefits by eliciting for each individual the subjective distribution of the replacement rate as a summary indicator of social security wealth. We find substantial heterogeneity of pension risk and...
Persistent link: https://www.econbiz.de/10004991296
The extent to which consumers are aware of available financial assets depends on the incentives of asset suppliers to spread information about the instruments they issue. We propose a theoretical framework in which the amount of information disseminated and the probability of individuals...
Persistent link: https://www.econbiz.de/10005626724
The 1991 Italian Survey of Household Income and Wealth contains detailed information on how respondents acquired their main residence and any other real estate. This information is used to estimate the impact of inter vivos transfers on the saving period required to purchase a house and on the...
Persistent link: https://www.econbiz.de/10005626743
The diversity in the current degree of financial development across the EU can be a great opportunity at a time where this area is poised to become increasingly financially integrated. Integration should accelerate the development of the most backward financial markets, and allow companies from...
Persistent link: https://www.econbiz.de/10005802048
In this paper we focus on poor financial literacy as one potential factor explaining lack of portfolio diversification. We use the 2007 Unicredit Customers’ Survey, which has indicators of portfolio choice, financial literacy and many demographic characteristics of investors. We first propose...
Persistent link: https://www.econbiz.de/10005802067
Rational investors perceive correctly the value of financial information. Investment in information is therefore rewarded with a higher Sharpe ratio. Overconfident investors overstate the quality of their own information, and thus attain a lower Sharpe ratio. We contrast the implications of the...
Persistent link: https://www.econbiz.de/10005802069
The study describes the aggregate trends in Italian households' portfolios in the past decade and documents a massive shift towards riskier portfolios and an increase in stock market and mutual funds participation. The study then uses microeconomic data to analyze the pattern of direct and...
Persistent link: https://www.econbiz.de/10005802078