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Heterogenous Life-Cycle Profiles, Income Risk and Consumption Inequality

Primiceri, Giorgio E; van Rens, Thijs - C.E.P.R. Discussion Papers - 2006

Was the increase in income inequality in the US due to permanent shocks or merely to an increase in the variance of transitory shocks? The implications for consumption and welfare depend crucially on the answer to this question. We use CEX repeated cross-section data on consumption and income to...

Persistent link: https://www.econbiz.de/10005661588

Incomplete-Market Equilibria Solved Recursively on an Event Tree

Dumas, Bernard J; Lyasoff, Andrew - C.E.P.R. Discussion Papers - 2009

We develop a method that allows one to compute incomplete-market equilibria routinely for Markovian equilibria (when they exist). The main difficulty to be overcome arises from the set of state variables. There are, of course, exogenous state variables driving the economy but, in an incomplete...

Persistent link: https://www.econbiz.de/10005124234

Consumption Insurance or Consumption Mobility

Jappelli, Tullio; Pistaferri, Luigi - C.E.P.R. Discussion Papers - 1999

The theory of full consumption insurance posits that households are insulated from all idiosyncratic shocks so that the … prediction of the theory using a panel drawn from the Bank of Italy Survey of Household Income and Wealth. We design an … measurement error in consumption. The findings strongly reject the theory of full consumption insurance. …

Persistent link: https://www.econbiz.de/10005124364

Consumption and Labour Supply with Partial Insurance: An Analytical Framework

Heathcote, Jonathan; Storesletten, Kjetil; Violante, … - C.E.P.R. Discussion Papers - 2007

This paper develops an analytical framework to study consumption and labour supply in a rich class of heterogeneous-agent economies with partial insurance. The environment allows for trade in non-contingent and state-contingent bonds, for permanent and transitory idiosyncratic productivity...

Persistent link: https://www.econbiz.de/10005114147

Modelling the Impact of Demographic Change Upon the Economy

Miles, David K - C.E.P.R. Discussion Papers - 1997

It is well known that over the next few decades there will be significant changes in the demographic structures of nearly all developed countries; in the absence of massive immigration, or of catastrophic new fatal illnesses, by the middle of the next century the ratio of people of working age...

Persistent link: https://www.econbiz.de/10005656147

The Reform of Pension Systems: Winners and Losers Across Generations

Iben, Andreas; Miles, David K - C.E.P.R. Discussion Papers - 1998

In this paper we perform simulations with a stylized model of Germany and the United Kingdom to show which generations might be direct gainers, and which losers, from a transition to funded state pensions. We estimate what the structure of inter-generational bequests would need to be in a...

Persistent link: https://www.econbiz.de/10005656405

Trade Union Objectives and Economic Growth

Irmen, Andreas; Wigger, Berthold - C.E.P.R. Discussion Papers - 2001

A trade union whose purpose is to raise wages above the competitive level may foster economic growth if it succeeds in shifting income away from the owners of capital to the workers and if the workers' marginal propensity to save exceeds that of capitalists. We make this point in an overlapping...

Persistent link: https://www.econbiz.de/10005123702

Intergenerational Redistribution in the Great Recession

Glover, Andrew; Heathcote, Jonathan; Krueger, Dirk; … - C.E.P.R. Discussion Papers - 2011

In this paper we construct a stochastic overlapping-generations general equilibrium model in which households are subject to aggregate shocks that affect both wages and asset prices. We use a calibrated version of the model to quantify how the welfare costs of severe recessions are distributed...

Persistent link: https://www.econbiz.de/10008915804

Subjective Discount Factors

Luttmer, Erzo G J; Mariotti, Thomas - C.E.P.R. Discussion Papers - 2000

This paper describes the equilibrium of a discrete-time exchange economy in which consumers with arbitrary subjective discount factors and quasi-homothetic period utility functions follow linear Markov consumption and portfolio strategies. Explicit expressions are given for state prices and...

Persistent link: https://www.econbiz.de/10005662071

Estimating Macroeconomic Models: A Likelihood Approach

Fernández-Villaverde, Jesús; Rubio-Ramírez, Juan … - C.E.P.R. Discussion Papers - 2006

This paper shows how particle filtering allows us to undertake likelihood-based inference in dynamic macroeconomic models. The models can be nonlinear and/or non-normal. We describe how to use the output from the particle filter to estimate the structural parameters of the model, those...

Persistent link: https://www.econbiz.de/10005504323