Read Books Online and Download eBooks, EPub, PDF, Mobi, Kindle, Text Full Free.
Download The Retirement Consumption Puzzle Theory And Empirical Evidence full books in PDF, epub, and Kindle. Read online The Retirement Consumption Puzzle Theory And Empirical Evidence ebook anywhere anytime directly on your device. Fast Download speed and no annoying ads. We cannot guarantee that every ebooks is available!
Author : Kevin Rink
Publisher : GRIN Verlag
ISBN 13 : 3640989791
Total Pages : 57 pages
Book Rating : 4.6/5 (49 download)
Download or read book Retirement-consumption Puzzle written by Kevin Rink and published by GRIN Verlag. This book was released on 2011 with total page 57 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Kevin Rink
Publisher : GRIN Verlag
ISBN 13 : 3640989724
Total Pages : 26 pages
Book Rating : 4.6/5 (49 download)
Download or read book The Retirement-Consumption Puzzle: Theory and Empirical Evidence written by Kevin Rink and published by GRIN Verlag. This book was released on 2011-08-23 with total page 26 pages. Available in PDF, EPUB and Kindle. Book excerpt: Seminar paper from the year 2011 in the subject Business economics - Investment and Finance, grade: 1,0, University of Mannheim, course: Seminar in Bankbetriebslehre und Behavioral Finance , language: English, abstract: The literature on consumption behavior finds that households consistently reduce consumption at retirement. It documents a consumption dip of between seven and 17% on average. However, according to life cycle theory, households smooth marginal utility of consumption across time periods. The discrepancy between the predictions of theory and empirical findings is known as the retirement-consumption puzzle. A deeper knowledge on retirement saving behavior is of interest for at least three reasons. First, it facilitates the testing of theoretical models like the life cycle hypothesis. Thereby, it helps to understand if and by how far individuals plan their retirement in a rational manner. Second,... [...] The task of this paper is to assess both theory and empirical evidence of the retirement consumption puzzle. It, therefore, discusses the basic characteristics of standard life cycle theory in section 2. Section 3 examines the main determinants of the puzzle and perspectives from which the puzzle has been investigated. Section 4 concludes.
Author : Melanie Velarde
Publisher :
ISBN 13 :
Total Pages : 103 pages
Book Rating : 4.:/5 (78 download)
Download or read book The Retirement Consumption Puzzle written by Melanie Velarde and published by . This book was released on 2011 with total page 103 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Steven Haider
Publisher :
ISBN 13 :
Total Pages : 52 pages
Book Rating : 4.:/5 (249 download)
Download or read book Is There a Retirement-consumption Puzzle? Evidence Using Subjective Retirement Expectations written by Steven Haider and published by . This book was released on 2004 with total page 52 pages. Available in PDF, EPUB and Kindle. Book excerpt: Previous research finds a systematic decrease in consumption at retirement, a finding that is inconsistent with the Life-Cycle/Permanent Income Hypothesis if retirement is an expected event. In this paper, we use workers' subjective beliefs about their retirement dates as an instrument for retirement. After demonstrating that subjective retirement expectations are strong predictors of subsequent retirement decisions, we still find a retirement consumption decline for workers who retire when expected. However, our estimates of this consumption fall are about a third less than those found when we instead rely on the instrumental variables strategy used in prior studies. Finally, we examine a number of hypotheses that have been put forward to explain the retirement consumption decline. We find little empirical support for these explanations in our data.
Author : Jonathan D. Fisher
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (137 download)
Download or read book The Retirement Consumption Conundrum written by Jonathan D. Fisher and published by . This book was released on 2008 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: While the life-cycle hypothesis predicts that consumption remains smooth during the transition from work into retirement, recent studies have shown that consumption declines at retirement. This empirical result has been referred to as the retirement consumption puzzle. Previous literature has most often relied on food expenditures to estimate the decline in consumption at retirement. We add to this literature by using broader definitions of consumption data from the Consumer Expenditure Survey (CEX), which is a survey designed to estimate total household expenditures. We conduct cohort analysis, using data on four cohorts over 20 years from 1984 to 2003. Our results using only food expenditures are on the lower end of the distribution of existing results. As we use broader measures of consumption, our results suggest that the retirement consumption conundrum decreases by more than half. Further, another contribution of this analysis is to widen the focus of the study of the well-being of the elderly. The retirement consumption puzzle does not tell the whole story on the well-being of the elderly. While we find that consumption-expenditures decrease by about 2.5 percent when individuals retire, expenditures continue to decline at about a rate of 1 percent per year after that.
Author : Susann Rohwedder
Publisher :
ISBN 13 :
Total Pages : 52 pages
Book Rating : 4.:/5 (2 download)
Download or read book The Retirement Consumption Puzzle written by Susann Rohwedder and published by . This book was released on 2008 with total page 52 pages. Available in PDF, EPUB and Kindle. Book excerpt: The simple one-good model of life-cycle consumption requires that consumption be continuous over retirement; yet prior research based on partial measures of consumption or on synthetic panels indicates that spending drops at retirement, a result that has been called the retirement-consumption puzzle. Using panel data on total spending, nondurable spending and food spending, we find that spending declines at small rates over retirement, at rates that could be explained by mechanisms such as the cessation of work-related expenses, unexpected retirement due to a health shock or by the substitution of time for spending. In the low-wealth population where spending did decline at higher rates, the main explanation for the decline appears to be a high rate of early retirement due to poor health. We conclude that at the population level there is no retirement consumption puzzle in our data, and that in subpopulations where there were substantial declines, conventional economic theory can provide the main explanation.
Author : Arna Olafsson
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (12 download)
Download or read book The Retirement-Consumption Puzzle written by Arna Olafsson and published by . This book was released on 2018 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper uses a detailed panel of individual spending, income, account balances, and credit limits from a personal finance management software provider to investigate how expenditures, liquid savings, and consumer debt change around retirement. The longitudinal nature of our data allows us to estimate individual fixed-effects regressions and thereby control for all selection on time-invariant (un)observables. We provide new evidence on the retirement-consumption puzzle and on whether individuals save adequately for retirement. We find that, upon retirement, individuals reduce their spending in both work-related and leisure categories. However, we feel that it is difficult to tell conclusively whether expenses are work related or not, even with the best data. We thus look at household finances and find that individuals delever upon retirement by reducing consumer debt and increasing liquid savings. We argue that these findings are difficult to rationalize via, for example, work-related expenses. A rational agent would save before retirement because of the expected fall in income, and dissave after retirement, rather than the exact opposite.
Author : Sven Schreiber
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (118 download)
Download or read book Leisure and Housing Consumption After Retirement : New Evidence on the Life-cycle Hypothesis written by Sven Schreiber and published by . This book was released on 2016 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Michael D. Hurd
Publisher :
ISBN 13 :
Total Pages : 34 pages
Book Rating : 4.:/5 (255 download)
Download or read book Some Answers to the Retirement-consumption Puzzle written by Michael D. Hurd and published by . This book was released on 2006 with total page 34 pages. Available in PDF, EPUB and Kindle. Book excerpt: The simple one-good model of life-cycle consumption requires "consumption smoothing." According to previous results based on partial spending and on synthetic panels, British and U.S. households apparently reduce consumption at retirement. The reduction cannot be explained by the simple one-good life-cycle model, so it has been referred to as the retirement-consumption puzzle. An interpretation is that at retirement individuals discover they have fewer economic resources than they had anticipated prior to retirement, and as a consequence reduce consumption. This interpretation challenges the life-cycle model where consumers are assumed to be forward-looking. Using panel data, we find that prior to retirement workers anticipated on average a decline of 13.3% in spending and after retirement they recollected a decline of 12.9%: widespread surprise is not the explanation for the retirement-consumption puzzle. Workers with substantial wealth both anticipated and recollected a decline. Therefore, for many workers the decline is not necessitated by the fall in income that accompanies retirement. Poor health is associated with above-average declines. At retirement time spent in activities that could substitute for market-purchased goods increases. Apparently a number of factors contribute to the decline in spending, which, for most of the population, can be accommodated in conventional models of economic behavior.
Author : Jonathan Fisher
Publisher :
ISBN 13 :
Total Pages : 35 pages
Book Rating : 4.:/5 (13 download)
Download or read book Does the Retirement Consumption Puzzle Differ Across the Distribution? written by Jonathan Fisher and published by . This book was released on 2013 with total page 35 pages. Available in PDF, EPUB and Kindle. Book excerpt: Previous research has repeatedly found a puzzling one-time drop in the mean and median of consumption at retirement, contrary to the predictions of the life-cycle hypothesis. However, very little is known as to whether these effects vary across the consumption distribution. This study expands upon the previous work by examining changes in the consumption distribution between the non-retired and the retired using quantile regression techniques on pseudo-cohorts from the cross-sectional data of the 1990-2007 Consumer Expenditure Survey. The results indicate that there are insignificant changes between these groups at the lower end of the consumption distribution, while there are significant decreases at the higher end of this distribution. In addition, these changes in the distribution are gradually larger in magnitude when moving from the lower end to the higher end, which is found using several different measures of consumption. Work-related expenditures are instead shown to decrease uniformly across the consumption distribution. This evidence reveals that there is a progressive distributional component to the retirement consumption puzzle.
Author : Emma Aguila
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (137 download)
Download or read book Changes in Consumption at Retirement written by Emma Aguila and published by . This book was released on 2008 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Previous empirical literature has found a sharp decline in consumption during the first years of retirement implying that individuals do not save enough for their retirement. This phenomenon has been called the retirement consumption puzzle. In contrast to some of the previous studies, the authors find no evidence of the retirement consumption puzzle during the first years of retirement. Consumption is defined as nondurable expenditure, a more comprehensive measure than only food used in many previous studies. Food expenditure at retirement decreases. The latter could be explained by a reallocation of the budget shares after retirement to adjust to a new stage in the life cycle. These results suggest that food expenditure is not an accurate measure to test the Life Cycle Model.
Download or read book The Retirement Consumption Puzzle written by and published by . This book was released on 2008 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: In this paper we investigate the size of the consumption drop at retirement in Italy. We use micro data on food and total non-durable household spending covering the period 1993-2004, and evaluate the change in consumption that accompanies retirement by exploiting the exogenous variability in pension eligibility to correct for the endogenous nature of the retirement decision. We take a regression discontinuity approach, and make the identifying assumption that consumption would be the same around the threshold for pension eligibility if individuals would not retire. We check in our data that a non-negligible fraction of individuals retire as soon as they become eligible, and estimate at 9:8% the part of the non-durable consumption drop that is associated with retirement induced by eligibility. We show that such fall is not driven by liquidity problems for the less well off in the population, and can be accounted for by drops in goods that are ork-related expenses or leisure substitutes. However, we also show that retirement induces a significant drop in the number of grown children living with their parents, and this can account for most of the retirement consumption drop. -- Consumption ; Regression Discontinuity Design ; Retirement
Author : Michael Hurd
Publisher :
ISBN 13 :
Total Pages : 31 pages
Book Rating : 4.:/5 (248 download)
Download or read book The Retirement-consumption Puzzle written by Michael Hurd and published by . This book was released on 2003 with total page 31 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Robert Varady
Publisher :
ISBN 13 :
Total Pages : 92 pages
Book Rating : 4.:/5 (228 download)
Download or read book Home Produced Consumption and the Retirement-consumption Puzzle written by Robert Varady and published by . This book was released on 2006 with total page 92 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Melvin Stephens
Publisher :
ISBN 13 :
Total Pages : 0 pages
Book Rating : 4.:/5 (137 download)
Download or read book Can Unexpected Retirement Explain the Retirement-Consumption Puzzle? Evidence for Subjective Retirement Expectations written by Melvin Stephens and published by . This book was released on 2008 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Previous research finds a systematic fall in consumption at retirement, even when these retirements are expected, which implies households do not behave as predicted by the lifecycle/ permanent income hypothesis. However, the worker's expected date of retirement is typically predicted using an instrument - age - that we show to be correlated with unexpected retirements and will therefore lead to biased estimates. In this paper, we use an alternative instrument for expected retirement: workers' own subjective beliefs of their expected retirement dates. We find that subjective retirement expectations provide strong predictive power for subsequent retirements above and beyond the impact of age on retirement probabilities. We still find, however, that consumption falls for workers who retire when expected although the estimated impact is 50 percent smaller when using retirement expectations as an instrument instead of age.
Author : Garry Barrett
Publisher :
ISBN 13 :
Total Pages : 39 pages
Book Rating : 4.:/5 (77 download)
Download or read book Involuntary Retirement and the Resolution of the Retirement-consumption Puzzle written by Garry Barrett and published by . This book was released on 2010 with total page 39 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Author : Jonathan David Fisher
Publisher :
ISBN 13 :
Total Pages : 37 pages
Book Rating : 4.:/5 (712 download)
Download or read book Does the Retirement Consumption Puzzle Differ Across the Distribution? written by Jonathan David Fisher and published by . This book was released on 2011 with total page 37 pages. Available in PDF, EPUB and Kindle. Book excerpt: Previous research has repeatedly found a puzzling one-time drop in consumption at retirement at the mean or median. This study expands upon the previous work by examining these same retirement changes across the entire consumption distribution through the application of quantile regression techniques on data from the 1990-2007 Consumer Expenditure Survey. The evidence indicates gradually larger decreases in consumption across the distribution using several measures of consumption, with insignificant changes shown at lower deciles and the greatest drops occurring at the higher deciles.
