An analysis of 6,113 households with four quarters of expenditure data in the 2004-2005 U.S. Consumer Expenditure Interview Survey found that 43% of households had outlays more than aftertax income, and 25% of households had outlays that were 127% or more of aftertax income. Black and...

Empirical studies have found that most households do not have recommended levels of emergency funds. A three-period model of optimal consumption is presented. The theoretical model suggests that many consumers without recommended levels of liquid assets may be acting rationally. The model is...

In this research we compare the risk preference attitudes and behavior between a sample of 470 Chinese workers and a sample of 2,671 Americans from the Survey of Consumer Finances. Our findings show that Chinese in our sample are more risk tolerant than Americans in their financial decisions,...