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Asymmetric information and financial markets

Estrada, Fernando - 2012

This paper aims to explore the relevance of the Asymmetric Information and the Theory of Argumentation TA in the …

Persistent link: https://www.econbiz.de/10015232216

Optimal decisions on pension plans in the presence of financial literacy costs and income inequalities

Corsini, Lorenzo; Spataro, Luca - 2011

Pension reforms are on the political agenda of many countries. Such reforms imply an increasing responsibility on individuals’ side in building an efficient portfolio for retirement. In this paper we provide a model describing workers’ choices on the allocation of retirement savings in...

Persistent link: https://www.econbiz.de/10015226915

Target-driven investing: Optimal investment strategies in defined contribution pension plans under loss aversion

Blake, David; Wright, Douglas; Zhang, Yumeng - 2011

insurance'. We show that under loss aversion, the risk of failing to attain the target replacement ratio is significantly …

Persistent link: https://www.econbiz.de/10015229033

Dynamic Stock Market Participation of Households

Khorunzhina, Natalia - 2011

This paper develops and estimates a dynamic model of stock market participation, where consumers’ decisions regarding stock market participation are influenced by participation costs. The practical significance of the participation costs is considered as being a channel through which financial...

Persistent link: https://www.econbiz.de/10015229691

Reexamining the Empirical Relevance of Habit Formation Preferences

Cai, Zongwu; Liu, Xuan; Yang, Fang - 2012

We reexamine the empirical relevance of habit formation preferences with micro-data on households' portfolio choices. We first derive the analytical solution to the risky asset share in a theoretical model with both habits and time-varying labor income. Our analytical results indicate that (1)...

Persistent link: https://www.econbiz.de/10015231310

Savings for retirement under liquidity constraints: a note

Corsini, Lorenzo; Spataro, Luca - 2012

Pension systems often entail some compulsory saving over which individuals have some degree of choice in terms of the pension plan in which to invest. Our contribution analyses whether the choice between alternative plans is affected by the presence of liquidity constraints during working life....

Persistent link: https://www.econbiz.de/10015231981

Does Relative Risk Aversion Vary with Wealth? Evidence from Households' Portfolio Choice Data

Liu, Xuan; Yang, Fang; Cai, Zongwu - 2012

We analyze whether relative risk aversion varies with wealth. We first derive theoretical predictions on how risky … Dynamics. Contrary to the existing literature, our empirical results show evidence of relative risk aversion varying with …

Persistent link: https://www.econbiz.de/10015234208

Accounting for non-annuitization

Pashchenko, Svetlana - 2012

Why don't people buy annuities? Several explanations have been provided by the previous literature: large fraction of preannuitized wealth in retirees' portfolios; adverse selection; bequest motives; and medical expense uncertainty. This paper uses a quantitative model to assess the importance...

Persistent link: https://www.econbiz.de/10015234696

Endogenous financial literacy, saving and stock market participation

Spataro, Luca; Corsini, Lorenzo - 2013

There is a consolidated empirical literature providing evidence of the fact that financial literacy, human capital, savings and stock market participation are interconnected decisions. However, to the best of our knowledge, a theoretical explanation of such connections is missing. In this paper...

Persistent link: https://www.econbiz.de/10015235695

Housing Decision with Divorce Risk

Fischer, Marcel; Khorunzhina, Natalia - 2018

We build a realistically calibrated life-cycle model of housing decisions under divorce risk. As observed in the data … negatively affects homeownership, and this effect is long-lasting. The risk of a divorce triggers a precautionary savings motive … partially substitute for precautionary savings. When young, the larger asset accumulation due to divorce-risk induced …

Persistent link: https://www.econbiz.de/10015262095