Life-Cycle Preferences Revisited

An axiomatic construction for lifecycle preferences accounting for the finiteness and the randomness of life duration is provided. We emphasize the role of intertemporal correlation aversion and explain why multiplica- tive preferences provide an interesting alternative to additive preferences, allowing to separate risk aversion from intertemporal elasticty of substitu- tion. Implications regarding the shape of the optimal consumption pro?files are discussed.

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Year of publication:	2011
Authors:	Bommier, Antoine
Publisher:	Zurich : ETH Zurich, CER-ETH - Center of Economic Research
Subject:	Lebenszyklus \| Intertemporale Entscheidung \| Risikoaversion \| Substitutionselastizität \| Nachfragetheorie des Haushalts \| Theorie \| Intertemporal choice \| Life-cycle models \| Multivariate risk aver- sion \| Uncertain lifetime

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Series:	Economics Working Paper Series ; 11/155
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Working Paper
Language:	English
Other identifiers:	10.3929/ethz-a-006820229 [DOI] 718548329 [GVK] hdl:10419/171598 [Handle] RePEc:eth:wpswif:11-155 [RePEc]
Classification:	D91 - Intertemporal Consumer Choice; Life Cycle Models and Saving
Source:	EconStor

Persistent link: https://www.econbiz.de/10011753219