The main aim of this paper is to assess the validity of the life cycle model of consumption. In particular, we address an issue that has recently received much attention, especially in the macroeconomic literature: that of "excess sensitivity" of consumption growth to income growth. We do this...

The issue of asset accumulation and decumulation is central to the life cycle theory of consumer behavior and to many policy questions. One of the main implications of the life cycle model is that assets are decumulated in the last part of life. Most empirical studies in this area use...

In this paper I analyze the pattern of saving behavior by U.S. households, using the Consumer Expenditure (CEX) Survey. The analysis' main goal is to explain the decline in aggregate personal saving in the United States in the 1980s. I estimate a typical' saving-age profile and identify...

In this paper we estimate the effect of the Mexican conditional cash transfer program, Oportunidades, on consumption, and we explore some issues related to participation to the program and to the estimation of treatment effects. We discuss the comparability of treatment and control areas,...

The paper studies the effects of Familias en Acción, a conditional cash transfer programme implemented in rural areas in Colombia in 2002, on school enrolment and child labour. Using a quasi-experimental approach, our methodology makes use of an interesting feature of the data, which allows us...

In this paper we present empirical evidence of the importance of aggregation bias in Euler equations for consumption. The main result is that estimates of the elasticity of intertemporal substitution for consumption are consistently lower for aggregate data than for average cohort data. In...

The complete insurance hypothesis is soundly rejected by the data (e.g. Attanasio and Davis, 1996). On the other hand, the permanent income model assumes that the only mechanism available to the agents to smooth consumption is personal savings (self insurance). Those are clearly two extreme...

How far can shoe-leather go in explaining the welfare cost of inflation? Using a unique set of microeconomic data on households, we estimate the parameters of the demand for money derived from the generalized Baumol-Tobin model. Our data set contains information on average holdings of cash, on...