Previous tests for liquidity constraints using consumption Euler equations have frequently used asset-based sample separation rules, arguing that low wealth consumers are more likely to be constrained. We propose an alternative sample separation rule using direct information on borrowing...

Previous tests for liquidity constraints using consumption Euler equations have frequently split the sample on the basis of wealth, arguing that low-wealth consumers are more likely to be constrained. We propose alternative tests using different and more direct information on borrowing...

Previous tests for liquidity constraints using consuption Euler equations have frequently split the sample on the basis of wealth, arguing that low-wealth consumers are likely tp be constrained. We propose alternative tests using different and more direct information on borrowing constraints...

For households that face a possibility of moving across MSAs, the risk of home owning depends on the covariance of the sale prices of their current houses with the purchase prices of their likely future houses. We find empirically that households tend to move between highly correlated MSAs,...

The authors use a new panel data set of credit card accounts to analyze how consumers responded to the 2001 federal income tax rebates. They estimate the monthly response of credit card payments, spending, and debt, exploiting the unique, randomized timing of the rebate disbursement. They find...

This paper documents the trends in the life-cycle profiles of net worth and housing equity between 1983 and 2004. The net worth of older households significantly increased during the housing boom of recent years. However, net worth grew by more than housing equity, in part because other assets...

This paper takes a portfolio view of consumer credit. Default models (credit-risk scores) estimate the probability of default of individual loans. But to compute risk-adjusted returns, lenders also need to know the covariances of the returns on their loans with aggregate returns. Covariances are...

This paper utilizes a unique new data set on credit card accounts to analyze how people respond to changes in credit supply. The data consist of a panel of several hundred thousand individual credit card accounts followed monthly for 24-36 months, from several different card issuers, with...

Unions compress the wage distribution among workers covered by union contracts. We ask whether unions also have an effect on the mangers of unionized firms. To this end we collected and assembled data on unionization and managerial pay within firms and industries in the US and across countries....