consumption across states of nature, one must also consider the assets;́ effects on households;́ ability to smooth consumption … returns correlate negatively with income shocks) even though the assets offer identical opportunities to smooth consumption … be substantial (above 1 percent of certainty-equivalent consumption), the assets we consider can only mitigate a …

fully attend to consumption in all periods but fail to attend to some future lumpy expenditure opportunities. This asymmetry …