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Dissecting saving dynamics: Measuring wealth, precautionary, and credit effects

Carroll, Christopher D.; Slacalek, Jiri; Sommer, Martin - Center for Financial Studies - 2012

We argue that the US personal saving rate's long stability (1960s-1980s), subsequent steady decline (1980s-2007), and … of labor income uncertainty and credit constraints. Saving in the model is affected by the gap between target and actual … suggests that increased credit availability accounts for most of the long-term saving decline, while fluctuations in wealth and …

Persistent link: https://www.econbiz.de/10010958787

Household debt and crises of confidence

Hintermaier, Thomas; Koeniger, Winfried - 2015

We show that the size of collateralized household debt determines an economy's vulnerability to crises of confidence. The house price feeds back on itself by contributing to a liquidity effect, which operates through the value of housing in a collateral constraint. Over a specific range of debt...

Persistent link: https://www.econbiz.de/10011348214

How large is the housing wealth effect? A new approach

Carroll, Christopher D.; Otsuka, Misuzu; Slacalek, Jirka - Center for Financial Studies - 2006

This paper presents a simple new method for estimating the size of wealth effects on aggregate consumption. The method exploits the well-documented sluggishness of consumption growth (often interpreted as habits in the asset pricing literature) to distinguish between short-run and long-run...

Persistent link: https://www.econbiz.de/10010986368

The reaction of consumer spending and debt to tax rebates: Evidence from consumer credit data

Lusardi, Annamaria; Mitchell, Olivia S. - Center for Financial Studies - 2007

, whereas debt declined most (so saving rose most) for unconstrained consumers. More generally, the results suggest that there …

Persistent link: https://www.econbiz.de/10010986371

Trust in risk sharing: A double-edged sword

Cole, Harold L.; Krueger, Dirk; Mailath, George J.; … - 2023

We analyze efficient risk-sharing arrangements when the value from deviating is determined endogenously by another risk sharing arrangement. Coalitions form to insure against idiosyncratic income risk. Self-enforcing contracts for both the original coalition and any coalition formed (joined)...

Persistent link: https://www.econbiz.de/10013557357

Neoclassical growth with long-term one-sided commitment contracts

Krueger, Dirk; Uhlig, Harald - 2023

This paper characterizes the stationary equilibrium of a continuous-time neoclassical production economy with capital accumulation in which households can insure against idiosyncratic income risk through long-term insurance contracts. Insurance companies operating in perfectly competitive...

Persistent link: https://www.econbiz.de/10013557358

The heterogeneous response of real estate asset prices to a global shock

Heiniger, Sandro; Koeniger, Winfried; Lechner, Michael - 2022

We estimate the transmission of the pandemic shock in 2020 to prices in the residential and commercial real estate market by causal machine learning, using new granular data at the municipal level for Germany. We exploit differences in the incidence of Covid infections or short-time work at the...

Persistent link: https://www.econbiz.de/10014493084

Wealth shocks, unemployment shocks and consumption in the wake of the Great Recession

Christelis, Dimitris; Georgarakos, Dimitris; Jappelli, … - 2014

We use data from the 2009 Internet Survey of the Health and Retirement Study to examine the consumption impact of wealth shocks and unemployment during the Great Recession in the US. We find that many households experienced large capital losses in housing and in their financial portfolios, and...

Persistent link: https://www.econbiz.de/10010420293

Do demographics prevent consumer aggregates from reflecting micro-level preferences?

Koulovatianos, Christos; Schröder, Carsten; Schmidt, Ulrich - 2014

Most simulated micro-founded macro models use solely consumer-demand aggregates in order to estimate deep economy-wide preference parameters, which are useful for policy evaluation. The underlying demand-aggregation properties that this approach requires, should be easy to empirically disprove:...

Persistent link: https://www.econbiz.de/10010421122

Fitting parsimonious household- portfolio models to data

Hubar, Sylwia; Koulovatianos, Christos; Li, Jian - 2014

saving rates increase in wealth, too. The key is introducing subsistence consumption to an Epstein-Zin-Weil utility function …

Persistent link: https://www.econbiz.de/10010426998