Households face earnings risk which is non-normal and varies by age and over the income distribution. We show that … assets. Because households are subject to more background risk than previously considered, the estimated model implies a … substantially lower coefficient of risk aversion. We also find renewed support for rule-of-thumb investment strategies under the …

indirect health cost (value of health lost) of unhealthy consumption. The health cost increases with wealth and the degree of … differences, and ultimately health outcomes, between wealth groups …