Saving Behavior under the Influence of Income Risk: An Experimental Study

Individual subjects are experimentally tested for precautionary saving. We use a simplified experimental framework and decision supporting tool to show that subject's consumption is consistent with precautionary saving. We find that subjects overact in changing current income. However, those over-reactions cancel each other, and subject's consumption behavior is close to the optimal solutions on average.

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Year of publication:	2010
Authors:	Kitamura, Tomoki ; Yonezawa, Yasuhiro ; Nakasato, Munenori
Published in:	Economics Bulletin. - AccessEcon, ISSN 1545-2921. - Vol. 30.2010, 2, p. 967-974
Publisher:	AccessEcon
Subject:	Precautionary Saving \| Experiment

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Extent:	application/pdf
Type of publication:	Article
Language:	English
Classification:	D1 - Household Behavior and Family Economics
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10008503152