Disentangling the Wealth Effect
Author | : Dean M. Maki |
Publisher | : |
Total Pages | : 84 |
Release | : 2001 |
Genre | : Saving and investment |
ISBN | : |
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Author | : Dean M. Maki |
Publisher | : |
Total Pages | : 84 |
Release | : 2001 |
Genre | : Saving and investment |
ISBN | : |
Author | : Charles A. Fleischman |
Publisher | : |
Total Pages | : 44 |
Release | : 2001 |
Genre | : Bank holding companies |
ISBN | : |
Author | : Laurent Bach |
Publisher | : |
Total Pages | : 56 |
Release | : 2018 |
Genre | : |
ISBN | : |
This paper investigates the channels through which saving flows impact the dynamics of wealth inequality. The analysis relies on an administrative panel that reports the assets and income of every Swedish resident at the yearly frequency. We document that the saving rate, defined as saving from labor income divided by net worth, is on average a decreasing function of net worth itself. The saving rate is also highly heterogeneous within net worth brackets. Heterogeneity across and within net worth brackets have conflicting effects on wealth inequality. As a result, saving rate heterogeneity is measured to have a strong impact on social mobility but only a weak impact on the distribution of net worth. Heterogeneity in wealth return is instead the main driver of the recent increase in top wealth shares.
Author | : Mr.Christopher Carroll |
Publisher | : International Monetary Fund |
Total Pages | : 47 |
Release | : 2012-09-01 |
Genre | : Business & Economics |
ISBN | : 1475505698 |
We argue that the U.S. personal saving rate’s long stability (from the 1960s through the early 1980s), subsequent steady decline (1980s - 2007), and recent substantial increase (2008 - 2011) can all be interpreted using a parsimonious ‘buffer stock’ model of optimal consumption in the presence of labor income uncertainty and credit constraints. Saving in the model is affected by the gap between ‘target’ and actual wealth, with the target wealth determined by credit conditions and uncertainty. An estimated structural version of the model suggests that increased credit availability accounts for most of the saving rate’s long-term decline, while fluctuations in net wealth and uncertainty capture the bulk of the business-cycle variation.
Author | : Tullio Jappelli |
Publisher | : Oxford University Press |
Total Pages | : 313 |
Release | : 2017 |
Genre | : Business & Economics |
ISBN | : 0199383154 |
In The Economics of Consumption, Tullio Jappelli and Luigi Pistaferri provide a comprehensive examination of the most important developments in the field of consumption decisions and evaluate economic models against empirical evidence.
Author | : John Bates Clark |
Publisher | : |
Total Pages | : 490 |
Release | : 1899 |
Genre | : Wages, prices and productivity |
ISBN | : |
Author | : Carlos Caceres |
Publisher | : International Monetary Fund |
Total Pages | : 32 |
Release | : 2019-05-24 |
Genre | : Business & Economics |
ISBN | : 1498317189 |
This paper analyzes the existence of “wealth effects” derived from net equity (in the form of housing, financial assets, and total net worth) on consumption. The study uses longitudinal household-level data?from the Panel Study of Income Dynamics (PSID) ?covering about 7,000-9,000 households in the U.S., with the estimations carried over the period 1999-2017. Overall, wealth effects are found to be relatively large and significant for housing wealth, but less so for other types of wealth, including stocks. Furthermore, the analysis shows how these estimated marginal propensities to consume (MPC) from wealth are closely linked to household characteristics, including income and demographic factors. Finally, underlying structural changes in household characteristics point to potentially lower aggregate MPCs from wealth going forward.
Author | : Andreas Fagereng |
Publisher | : International Monetary Fund |
Total Pages | : 69 |
Release | : 2018-07-27 |
Genre | : Business & Economics |
ISBN | : 1484370066 |
We provide a systematic analysis of the properties of individual returns to wealth using twelve years of population data from Norway’s administrative tax records. We document a number of novel results. First, during our sample period individuals earn markedly different average returns on their financial assets (a standard deviation of 14%) and on their net worth (a standard deviation of 8%). Second, heterogeneity in returns does not arise merely from differences in the allocation of wealth between safe and risky assets: returns are heterogeneous even within asset classes. Third, returns are positively correlated with wealth: moving from the 10th to the 90th percentile of the financial wealth distribution increases the return by 3 percentage points - and by 17 percentage points when the same exercise is performed for the return to net worth. Fourth, wealth returns exhibit substantial persistence over time. We argue that while this persistence partly reflects stable differences in risk exposure and assets scale, it also reflects persistent heterogeneity in sophistication and financial information, as well as entrepreneurial talent. Finally, wealth returns are (mildly) correlated across generations. We discuss the implications of these findings for several strands of the wealth inequality debate.
Author | : Sahra Wagenknecht |
Publisher | : Campus Verlag |
Total Pages | : 329 |
Release | : 2013-10-02 |
Genre | : Business & Economics |
ISBN | : 3593399164 |
In The Limits of Choice, Sahra Wagenknecht examines household saving decisions and basic needs in Germany and the United States, based on official data from both countries from the 1950s to present day. Arguing against the hypothesis that assumes consumers optimize their consumption intertemporally based exclusively on their permanent or lifetime income, Wagenknecht proposes a rule of thumb, according to which consumers will save if their current income exceeds basic expenditure, while they will demand credit when income can no longer meet basic needs.
Author | : Robert Kuttner |
Publisher | : Chelsea Green Publishing |
Total Pages | : 226 |
Release | : 2008 |
Genre | : Biography & Autobiography |
ISBN | : 1603580794 |
Invoking America's greatest leaders, Robert Kuttner explains how Obama must be a transformative president--or a failed one--a president who must succeed in fundamentally changing our economy, society, and democracy for the better.