Showing 1 - 10 of 8,294
we identify conditions under which preferences over sets of construction opportunities can be reduced to preferences …
Persistent link: https://www.econbiz.de/10005346001
This study investigates how subjective mortality expectations and heterogeneity in time and risk preferences affect the … cannot be explained by differences in preferences. In contrast, this study identifies a strong relationship between answers … to survey questions about time and risk preferences and consumption and saving behaviors. This paper uses data on …
Persistent link: https://www.econbiz.de/10005822956
Numerous laboratory studies find that minor nuances of presentation and description change behavior in ways that are inconsistent with standard economic models. How much do these context effects matter in natural settings, when consumers make large, real decisions and have the opportunity to...
Persistent link: https://www.econbiz.de/10005490038
This paper provides a new life cycle model that takes into account key elements of bounded rationality. The paper shows that the model can account for patterns in the data that are hard to explain by the standard life cycle model. Among other patterns, the model predicts that, typically, the...
Persistent link: https://www.econbiz.de/10010573230
This paper develops a new life cycle model that aims to describe the savings and asset allocation choices of boundedly rational agents. In this model, agents make forward-looking decisions without the requirement of anticipating their actual future decisions. Instead, agents pursue two simple...
Persistent link: https://www.econbiz.de/10011091641
This paper develops a new life cycle model that aims to describe the savings and asset allocation decisions of boundedly rational agents. The paper’s main theoretical contribution is the provision of a simple, tractable and parsimonious framework within which agents make forward looking...
Persistent link: https://www.econbiz.de/10011092155
Life cycle saving decisions belong to the most complex financial decisions that we are faced with in our life. Psychologists have found that when making complex decisions people use short-cuts in the form of minimum requirements for particular attribute categories of choice options. This paper...
Persistent link: https://www.econbiz.de/10011092485
Consider an agent who is unsure of the state of the world and faces computational bounds on mental processing. The agent receives a sequence of signals imperfectly correlated with the true state that he will use to take a single decision. The agent is assumed to have a finite number of "states...
Persistent link: https://www.econbiz.de/10010556294
In an environment with stocks and short-term debt, random changes in the risk-reward frontier produce hedging demands for equities, implying that portfolio policies supporting optimal life-cycle consumption are rarely mean-variance efficient. Pursuing optimal life-cycle portfolio policies is...
Persistent link: https://www.econbiz.de/10012721591
Lines of credit (LOCs) are widely used by consumers. Here, we try to understand the major motives of such prevalent use. We model LOCs as instruments of consumption smoothing across states and time periods. A fundamental feature of insurance contracts is that insurance premiums are payable at...
Persistent link: https://www.econbiz.de/10012721626