The goal of this paper is to determine the effects of different social security regimes on job search. A less generous pension system induces higher savings across the life cycle and makes agents wealthier and thus more reluctant to accept low wage offers. On the other hand, as the social...

We solve in closed form the optimal consumption / portfolio choice problem for the class of isoelastic utility functions under incomplete information about the mean return of the stock price. Our approach consists in converting the original investor's problem into an equivalent program where the...

This paper presents a model developed to explain the life-cycle patterns in both homeownership and portfolio allocation, and the relationship between them, using a model of rational agents. Two key innovations are incorporated into this model. First, housing is explicitly modeled as both a...

This paper uses Generational Accounting to assess the fiscal impacts of Korean reunification. Our findings suggest that early reunification will result in a large increase in the fiscal burden for most current and future generations of South Koreans. The Korean reunification’s fiscal...

This paper investigates whether there is a non-linear relationship between income and the private transfers received by households in developing countries. If private transfers are unresponsive to household income, expansion of public social security is unlikely to crowd out private transfers,...

In previous research, I find that a reduction of the cost-of-living adjustment has performed quite well in comparisons among different Social Security reform proposals. While a COLA reduction contains many positive features, there is some concern that it would push the most vulnerable members of...

Consumption is partly a social activity, yet most studies of consumer behavior treat households in isolation. We investigate familial relationships in consumption patterns using a sample of parents and their children from the Panel Study of Income Dynamics. We find a positive and statistically...

This paper investigates the microfoundation of consumer decisions in Argentina. Structural parameters are estimated following the Euler Equation-GMM approach. Attention is focussed on parameter instability, an empirical difficulty for applying this method often pointed out in the literature. The...

This paper analyzes a unique dataset, which contains results of a large-scale experiment in the credit card market. Two strange phenomena that suggest time inconsistency in consumer behavior are observed: First, consumers prefer an introductory offer which has a lower interest rate with a...

Recent empirical studies suggest that the average marginal propensity to consume (MPC) has declined. This paper explains the declining trend of the MPC with a standard representative consumer model where borrowing constraints become more relaxed as suggested by data. With an increase in...