This paper analyzes the impact of the age structure of the population on the household saving rate using time-series data for Japan for the 1955-2019 period. It finds that there is a cointegrating relationship between Japan's household saving rate and her dependency ratio (the ratio of the...

This paper studies household consumption behavior when saving motives differ due to preference or income risk heterogeneity. I show that self-insurance operates along two margins: a standard liquidity margin determined by the level of current resources and an intertemporal margin governed by...

Earnings uncertainty is central to most heterogeneous-household models. Yet, there is little evidence on how subjective uncertainty, the uncertainty individuals actually perceive, is related to consumption behavior. Using unique data from the Survey of Consumer Expectations, we show that the...

Earnings uncertainty is central to most heterogeneous-household models. Yet, there is surprisingly little evidence on how subjective uncertainty is related to consumption behavior. Using unique data from the Survey of Consumer Expectations, we show that the marginal propensity to consume (MPC)...

Earnings uncertainty is central to most heterogeneous-household models. Yet, there is surprisingly little evidence on how subjective uncertainty is related to consumption behavior. Using unique data from the Survey of Consumer Expectations, we show that the marginal propensity to consume (MPC)...

We show how tax kinks can be used to estimate the marginal propensity to consume (MPC). Tax kinks create discrete changes in the relationship between taxable income and disposable income, which - under a set of testable assumptions - enables causal identification of the spending response to...