We address the issue of the efficiency of household portfolios in the presence of housing risk. We treat housing stock as an asset and rents as a stochastic liability stream: over the life cycle, households can be short or long in their net-housing position. Efficient financial portfolios are...

In this Paper we argue that standard tests of portfolio efficiency are biased because they neglect the existence of illiquid wealth. In the case of household portfolios, the most important illiquid asset is housing: if housing stock adjustments are costly and therefore infrequent, we show how...

We use life history data covering households in thirteen European countries to analyse residential moves past age 50. We observe four types of moves: renting to owning, owning to renting, trading up or trading down for home-owners. We find that in the younger group (aged 50-64) trading up and...

We use life history data covering households in 13 European countries to analyse residential moves past the age of 50. We observe four types of moves: renting to owning, owning to renting, trading up or trading down for homeowners. We find that in the younger group (aged 50–64), trading up and...

In this paper, we use two complementary Italian data sources (the 1995 ISTAT and Bank of Italy household surveys) to generate householdspecific nondurable expenditure in the Bank of Italy sample that contains relatively high-quality income data. We show that food expenditure data are of...