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The marginal propensity to consume and multidimensional risk

Jouini, Elyès; Napp, Clotilde; Nocetti, Diego - In: Economics Letters 119 (2013) 2, pp. 124-127

Kimball (1990a,b) established that income risk increases the marginal propensity to consume if and only if absolute prudence decreases. We characterize decreasing and increasing multivariate prudence and show that a multidimensional risk increases the marginal propensity to consume if and only...

Persistent link: https://www.econbiz.de/10010664146

Nursing home residents make a difference—The overestimation of saving rates at older ages

Ziegelmeyer, Michael - In: Economics Letters 117 (2012) 3, pp. 569-572

Based on the HRS, I find strong dissaving of nursing home residents and a significant overestimation of U.S. saving rates from age 75 onwards if nursing home residents are excluded as in most micro datasets.

Persistent link: https://www.econbiz.de/10011041607

Precautionary saving and the notion of ambiguity prudence

Berger, Loïc - In: Economics Letters 123 (2014) 2, pp. 248-251

This letter develops a set of simple conditions under which an individual is willing to save an extra amount of money due to the presence of ambiguity concerning his second period wealth. This extra precautionary saving motive is naturally associated with the notion of ambiguity prudence.

Persistent link: https://www.econbiz.de/10011041733

Hyperbolic discounting and endogenous growth

Strulik, Holger - In: Economics Letters 126 (2015) C, pp. 131-134

This paper provides the closed form solution for the standard model of endogenous growth when consumers have present …-biased preferences and make time-inconsistent savings plans, which they revise continuously. It is shown that long-run growth is not … of economic growth is also the same under both discounting methods. In this sense present-bias preferences are harmless …

Persistent link: https://www.econbiz.de/10011189493

On the concavity of the consumption function with the time varying discount rate

Gong, Liutang; Zhong, Ruquan; Zou, Heng-fu - In: Economics Letters 117 (2012) 1, pp. 99-101

In this paper, we consider a finite-horizon model with the time-additive utility and the time varying discount rate. With the assumption of the concavity of absolute risk tolerance, the concavity of the consumption function has been proved. This result significantly broadens the conclusion of...

Persistent link: https://www.econbiz.de/10010580543

Social capital and political institutions: Evidence that democracy fosters trust

Ljunge, Martin - In: Economics Letters 122 (2014) 1, pp. 44-49

This paper finds evidence that more democratic political institutions increase trust. Second generation immigrants with ancestries from 115 countries are studied within 30 European countries. Comparing individuals born and residing in the same country, those whose father was born in a more...

Persistent link: https://www.econbiz.de/10010729478

Cultural transmission of civicness

Ljunge, Martin - In: Economics Letters 117 (2012) 1, pp. 291-294

This paper estimates the intergeneration transmission of civicness by studying second generation immigrants in 29 European countries. There is a significant transmission of civicness both on the mother’s and father’s side. The estimates provide evidence on the transmission of trustworthiness.

Persistent link: https://www.econbiz.de/10010580526

Financial dependence and growth: Diminishing returns to improvement in financial development

Shen, Leilei - In: Economics Letters 120 (2013) 2, pp. 215-219

This paper examines how much financial development facilitates economic growth by nonparametrically estimating the …

Persistent link: https://www.econbiz.de/10010678834

Credit constraints, inequality and the growth gains from trade

Caselli, Mauro - In: Economics Letters 121 (2013) 1, pp. 43-47

negatively the growth gains from trade liberalisation. Variations in the growth rate of value added–decomposed in the growth rate … of the number of establishments and the growth rate in average size–of manufacturing industries in 34 developing … countries before and after trade liberalisation are used to study the effects of inequality on the difference in growth under …

Persistent link: https://www.econbiz.de/10010702782

Directed technological change and factor shares

Hart, Rob - In: Economics Letters 119 (2013) 1, pp. 77-80

Directed technological change (DTC) concerns how stocks of factor-augmenting knowledge evolve relative to each other. We model investment in factor-augmenting knowledge at firm level, and show that relative investment rates depend on the relative factor shares and elasticities. Furthermore, we...

Persistent link: https://www.econbiz.de/10010662384

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