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(1988). The risk averse agent's savings play the role of a collateral, thereby improving consumption smoothing. Furthermore … savings and debt substitutable. If these assumptions are relaxed, consumption smoothing worsens but is still better than what …This paper studies the effect of combining different insurance schemes on the efficiency of consumption smoothing in an …
Persistent link: https://www.econbiz.de/10005100656
consumption-saving behavior. We construct a novel consumption-saving model where the household must infer the persistent component … marginal propensity to consume because the short run covariance between income growth and consumption growth increases when … can be identified from panel data on income and consumption. Finally, we estimate a high degree of knowledge in the Panel …
Persistent link: https://www.econbiz.de/10012928282
In a model of rational agent choice, in which agents value consumption and leisure as well as health, we establish that … (benefit) of achieving health. Observed positive trends in adult weight, brought on by higher levels of consumption and lower … individuals, unconstrained by concerns of income or time, can and will choose levels of consumption and leisure that exceed their …
Persistent link: https://www.econbiz.de/10014076198
proposed. These expectation adjustments generate highly heterogenous consumption responses to income windfalls: many households … previous explanations for these effects, including consumption adjustment cost and liquidity constraints. At the aggregate … level, consumption is less sensitive to expansionary policies during recessions and its excess smoothness varies …
Persistent link: https://www.econbiz.de/10013394356
on how many hours to work with obvious consequences for the household budget. We therefore model consumption and labor …
Persistent link: https://www.econbiz.de/10010277211
Assuming a risk-neutral bank and assuming household utility to be exponential, we show how under information symmetry the covariance of income and loan repayments may explain higher household borrowings than in the case without default option. Under ex post information asymmetry and positive...
Persistent link: https://www.econbiz.de/10010420837
consumption-saving behavior. We construct a novel consumption-saving model where the household must infer the persistent component … marginal propensity to consume because the short run covariance between income growth and consumption growth increases when … can be identified from panel data on income and consumption. Finally, we estimate a high degree of knowledge in the Panel …
Persistent link: https://www.econbiz.de/10013202228
We model consumption and labor supply behavior of a couple in a non-cooperative setting. Using minimal assumptions, we …
Persistent link: https://www.econbiz.de/10011603327
Most of the empirical literature on consumption behaviour over the last decades has focused on estimating Euler … policy relevant issues. Alternatively, many papers have proposed using the consumption function to forecast behaviour. This … paper follows in this tradition, by deriving an analytical consumption function in the presence of intertemporal non …
Persistent link: https://www.econbiz.de/10011604618
realizations is front loaded, a closed form aggregate consumption function with CRRA preferences is derived. To have a closed form … life-time wealth and then the optimal consumption path. The derived model captures precautionary saving, which is dependent ….S. consumption data. …
Persistent link: https://www.econbiz.de/10011604811