Previous empirical literature has found a sharp decline in consumption during the first years of retirement implying that individuals do not save enough for their retirement. This phenomenon has been called the retirement consumption puzzle. In contrast to some of the previous studies, the...

We discuss recent developments in the literature that studies how the dynamics of earnings and wages affect consumption choices over the life cycle. We start by analyzing the theoretical impact of income changes on consumptionhighlighting the role of persistence, information, size and...

In this paper we develop a novel approach to measuring individual welfare within households, recognizing that individuals may have both different preferences (particularly regarding public consumption) and differential access to resources. We construct a money metric measure of welfare that...