We show individuals investments chase stock index returns and are financed by foregoing consumption, even after controlling for individual-account level portfolio income effects and other high dimensional fixed effects. This effect only exists for positive stock index returns with no effects for negative returns and are driven by the most salient stock index rather than other stock indices that are more representative of total stock market returns. To finance the investment, the foregone consumption occurs in the week after stock index returns are realized and are more pronounced for luxuries than necessary goods, and durables versus non-durables and services. Contrary to predictions from rational models of investor behavior with financial constraints, wealthy and more liquid accounts exhibit a larger return-chasing investment and foregone consumption, more consistent with theories of extrapolative expectations and loss aversion.
{"title":"Foregone Consumption and Return-Chasing Investments","authors":"Sumit Agarwal, Ben Charoenwong, Pulak Ghosh","doi":"10.2139/ssrn.3428811","DOIUrl":"https://doi.org/10.2139/ssrn.3428811","url":null,"abstract":"We show individuals investments chase stock index returns and are financed by foregoing consumption, even after controlling for individual-account level portfolio income effects and other high dimensional fixed effects. This effect only exists for positive stock index returns with no effects for negative returns and are driven by the most salient stock index rather than other stock indices that are more representative of total stock market returns. To finance the investment, the foregone consumption occurs in the week after stock index returns are realized and are more pronounced for luxuries than necessary goods, and durables versus non-durables and services. Contrary to predictions from rational models of investor behavior with financial constraints, wealthy and more liquid accounts exhibit a larger return-chasing investment and foregone consumption, more consistent with theories of extrapolative expectations and loss aversion.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"63 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-03-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"123485492","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Employment helps reduce the risk of poverty. Through a randomized controlled trial, we evaluate the impact of a conditional cash transfer (CCT) program to low-income families with dependent children on household members' labor supply. Recipients are required to attend labor-market-oriented mentoring courses as a condition of the transfer. One year after admission to the program, fathers assigned to the CCT program are more likely to work (+14 percent) than fathers assigned to an unconditional cash transfer program or to a pure control group. No effect arises for mothers. Results seem to be explained by improved family networks and increased parental investments in activities that enhance labor market opportunities.
{"title":"Cash Transfer Programs and Household Labor Supply","authors":"Daniela Del Boca, C. Pronzato, G. Sorrenti","doi":"10.2139/ssrn.3568307","DOIUrl":"https://doi.org/10.2139/ssrn.3568307","url":null,"abstract":"Employment helps reduce the risk of poverty. Through a randomized controlled trial, we evaluate the impact of a conditional cash transfer (CCT) program to low-income families with dependent children on household members' labor supply. Recipients are required to attend labor-market-oriented mentoring courses as a condition of the transfer. One year after admission to the program, fathers assigned to the CCT program are more likely to work (+14 percent) than fathers assigned to an unconditional cash transfer program or to a pure control group. No effect arises for mothers. Results seem to be explained by improved family networks and increased parental investments in activities that enhance labor market opportunities.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"96 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132058190","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Background: The studies on consumption expenditure are important as it is related to poverty. Households with lowest total expenditure, a greater proportion of percentage expenditure spent on basic needs such as food and housing, then this results the household being more resources constrained (poorer) as a result. Objective: The study attempts to analyze the impact of demographic and socioeconomic characteristic of households on consumption expenditure in the Amhara National Region State (Ethiopia) using the latest Household Consumption Expenditure Survey (HCES) 2015/16. Methods: The study applied quantile regression model to identify determinants of consumption expenditure by considering per capita consumption expenditure as a dependent variable. We analyzed conditional consumption expenditure on OLS and at 7 selected quantiles: 0.05, 0.10, 0.25, 0.50, 0.75, 0.90, and 0.95 which will be denoted by , , …, and . The quantile effect of categorical variables is calculated based on Kennedy (1981) approach. Results: Households those own residential house, were headed by educated persons and whose household heads were employed (generating income) expends more. On the other hand, households headed by females expends less. Based on marital status unmarried household heads consumption expenditure is less than households who are married (or living together) at all quantiles except at the 95thquantile, while unmarried consumption expenditure is more than widowed, and divorced (or separated) at 90th& 95thquantile and 50th ,75th ,90th& 95thquantile respectively.
{"title":"Factors Affecting Consumption Expenditure in Ethiopia: The Case of Amhara National Regional State (ANRS)","authors":"S. Gebreselassie, Principal Ndlovu","doi":"10.31033/ijemr.10.1.3","DOIUrl":"https://doi.org/10.31033/ijemr.10.1.3","url":null,"abstract":"Background: The studies on consumption expenditure are important as it is related to poverty. Households with lowest total expenditure, a greater proportion of percentage expenditure spent on basic needs such as food and housing, then this results the household being more resources constrained (poorer) as a result. \u0000Objective: The study attempts to analyze the impact of demographic and socioeconomic characteristic of households on consumption expenditure in the Amhara National Region State (Ethiopia) using the latest Household Consumption Expenditure Survey (HCES) 2015/16. \u0000Methods: The study applied quantile regression model to identify determinants of consumption expenditure by considering per capita consumption expenditure as a dependent variable. We analyzed conditional consumption expenditure on OLS and at 7 selected quantiles: 0.05, 0.10, 0.25, 0.50, 0.75, 0.90, and 0.95 which will be denoted by , , …, and . The quantile effect of categorical variables is calculated based on Kennedy (1981) approach. \u0000Results: Households those own residential house, were headed by educated persons and whose household heads were employed (generating income) expends more. On the other hand, households headed by females expends less. Based on marital status unmarried household heads consumption expenditure is less than households who are married (or living together) at all quantiles except at the 95thquantile, while unmarried consumption expenditure is more than widowed, and divorced (or separated) at 90th& 95thquantile and 50th ,75th ,90th& 95thquantile respectively.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"78 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-02-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"134081229","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We use detailed household-level data from Denmark to analyze how the introduction of interest-only mortgages affected consumption expenditure and borrowing. Four years after the reform interest-only mortgages constituted 40 percent of outstanding mortgage debt. Using an ex-ante measure of exposure motivated by financial constraints, we show households who are more likely to use an IO mortgage, increased consumption substantially following the reform. The increase in consumption is driven by borrowing at the time of refinancing and by borrowers with lower pre-reform leverage ratios. Our results show changes in the mortgage contract can have large impacts on consumption expenditure.
{"title":"Interest-Only Mortgages and Consumption Growth: Evidence from a Mortgage Market Reform","authors":"Claes Bäckman, Natalia Khorunzhina","doi":"10.2139/ssrn.3533247","DOIUrl":"https://doi.org/10.2139/ssrn.3533247","url":null,"abstract":"We use detailed household-level data from Denmark to analyze how the introduction of interest-only mortgages affected consumption expenditure and borrowing. Four years after the reform interest-only mortgages constituted 40 percent of outstanding mortgage debt. Using an ex-ante measure of exposure motivated by financial constraints, we show households who are more likely to use an IO mortgage, increased consumption substantially following the reform. The increase in consumption is driven by borrowing at the time of refinancing and by borrowers with lower pre-reform leverage ratios. Our results show changes in the mortgage contract can have large impacts on consumption expenditure.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"56 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-02-06","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"123985506","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper evaluates the implication of student loan debt on labor market outcomes. I begin by developing a tractable theoretical framework to analytically demonstrate that individuals under the burden of debt tend to search less and end up with lower-paid jobs. I then develop and estimate a quantitative search model with risk-averse agents, on-the-job search, and vacancy creation using NLSY97 data to evaluate the proposed mechanism. My model suggests that, under the standard fixed repayment plan, borrowers’ consumption is reduced due to debt repayment and lower wage income. The latter indirect effect caused by inadequate job search is potentially larger and more persistent than the direct effect from debt repayment. The income-based repayment plan (IBR) alleviates this distortion; I analytically elucidate the channels and quantitatively evaluate the aggregate and distributional effects of IBR. The model implies that poorer and more indebted borrowers would benefit more from switching to IBR. On average, IBR alleviates the debt burden by about half, among which one-third is attributed to better job matches.
{"title":"Job Search under Debt: Aggregate Implications of Student Loans","authors":"Yan Ji","doi":"10.2139/ssrn.2976040","DOIUrl":"https://doi.org/10.2139/ssrn.2976040","url":null,"abstract":"This paper evaluates the implication of student loan debt on labor market outcomes. I begin by developing a tractable theoretical framework to analytically demonstrate that individuals under the burden of debt tend to search less and end up with lower-paid jobs. I then develop and estimate a quantitative search model with risk-averse agents, on-the-job search, and vacancy creation using NLSY97 data to evaluate the proposed mechanism. My model suggests that, under the standard fixed repayment plan, borrowers’ consumption is reduced due to debt repayment and lower wage income. The latter indirect effect caused by inadequate job search is potentially larger and more persistent than the direct effect from debt repayment. The income-based repayment plan (IBR) alleviates this distortion; I analytically elucidate the channels and quantitatively evaluate the aggregate and distributional effects of IBR. The model implies that poorer and more indebted borrowers would benefit more from switching to IBR. On average, IBR alleviates the debt burden by about half, among which one-third is attributed to better job matches.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"4 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"116929955","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Spending time with a spouse is a major gain from marriage. We extend the classical collective model of the household to allow for togetherness between spouses. Togetherness takes the form of joint leisure and joint care for children. Using revealed preference conditions and Dutch data over the years 2009–2012, we find that households are willing to pay €1.20 per hour—10 percent of the average wage—to convert private leisure to joint leisure and €2.10 per hour to convert private childcare to joint childcare. Our results suggest togetherness is an important component of household time use despite being overlooked in the economics literature. (JEL D12, D13, J12, J13, J16, J22)
{"title":"Togetherness in the Household","authors":"Sam Cosaert, A. Theloudis, Bertrand Verheyden","doi":"10.2139/ssrn.3538271","DOIUrl":"https://doi.org/10.2139/ssrn.3538271","url":null,"abstract":"Spending time with a spouse is a major gain from marriage. We extend the classical collective model of the household to allow for togetherness between spouses. Togetherness takes the form of joint leisure and joint care for children. Using revealed preference conditions and Dutch data over the years 2009–2012, we find that households are willing to pay €1.20 per hour—10 percent of the average wage—to convert private leisure to joint leisure and €2.10 per hour to convert private childcare to joint childcare. Our results suggest togetherness is an important component of household time use despite being overlooked in the economics literature. (JEL D12, D13, J12, J13, J16, J22)","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"11 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-01-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"133962596","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We develop and estimate a static model of labor supply that can account for two robust features of the cross-sectional distribution of usual weekly hours and hourly wages. First, usual weekly hours are heavily concentrated around 40 hours, while at the same time a substantial share of total hours come from individuals who work more than 50 hours. Second, mean hourly wages are non-monotonic across the usual hours distribution, with a peak for those working 50 hours. The novel feature of the model is that earnings are non-linear in hours and the nature of the nonlinearity varies over the hours distribution. We estimate the model on a sample of older males for whom human capital considerations are plausibly not of first order importance. Our estimates imply that an individual who chooses to work either less than 40 hours or more than 40 hours faces a wage penalty. As a consequence, individuals working typically 40 hours are not very responsive to variation in productivity. This has significant implications for the role of labor supply as a mechanism for self-insurance in a standard heterogeneous agent-incomplete markets model and for strategies designed to estimate the intertemporal elasticity of substitution.
{"title":"Hours and Wages","authors":"Alexander Bick, A. Blandin, Richard Rogerson","doi":"10.3386/w26722","DOIUrl":"https://doi.org/10.3386/w26722","url":null,"abstract":"We develop and estimate a static model of labor supply that can account for two robust features of the cross-sectional distribution of usual weekly hours and hourly wages. First, usual weekly hours are heavily concentrated around 40 hours, while at the same time a substantial share of total hours come from individuals who work more than 50 hours. Second, mean hourly wages are non-monotonic across the usual hours distribution, with a peak for those working 50 hours. The novel feature of the model is that earnings are non-linear in hours and the nature of the nonlinearity varies over the hours distribution. We estimate the model on a sample of older males for whom human capital considerations are plausibly not of first order importance. Our estimates imply that an individual who chooses to work either less than 40 hours or more than 40 hours faces a wage penalty. As a consequence, individuals working typically 40 hours are not very responsive to variation in productivity. This has significant implications for the role of labor supply as a mechanism for self-insurance in a standard heterogeneous agent-incomplete markets model and for strategies designed to estimate the intertemporal elasticity of substitution.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"28 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"129209954","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-12-24DOI: 10.21714/2179-9164.2019.v16n3.007
J. M. Tavares, Stanislav Ivanov, C. Cobanoglu
There isn´t a consensus about the impact of a first time or a repeat tourist on local economy since that the findings of studies comparing the amount of money spent by the two categories of tourists are inconclusive. We interviewed 500 people who went to any tourist destination more than once through a virtual platform in Brazil. This article uses Principal Component Analysis to analyze this issue. The results identified four types of repeat tourists, who tend to spend less than first-time tourists, but who may influence people to visit the destination due to their high degree of satisfaction. A recommendation for future research would be to use the Confirmatory Factor Analysis (CFA) to confirm the measurement model after conducting Exploratory Factor Analysis (EFA).
{"title":"Does the Repeat Tourist Spend More Than the First Time? A Contribution to the Literature","authors":"J. M. Tavares, Stanislav Ivanov, C. Cobanoglu","doi":"10.21714/2179-9164.2019.v16n3.007","DOIUrl":"https://doi.org/10.21714/2179-9164.2019.v16n3.007","url":null,"abstract":"There isn´t a consensus about the impact of a first time or a repeat tourist on local economy since that the findings of studies comparing the amount of money spent by the two categories of tourists are inconclusive. We interviewed 500 people who went to any tourist destination more than once through a virtual platform in Brazil. This article uses Principal Component Analysis to analyze this issue. The results identified four types of repeat tourists, who tend to spend less than first-time tourists, but who may influence people to visit the destination due to their high degree of satisfaction. A recommendation for future research would be to use the Confirmatory Factor Analysis (CFA) to confirm the measurement model after conducting Exploratory Factor Analysis (EFA).","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"87 2 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2019-12-24","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"127410189","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We document considerable heterogeneity in the fraction of older workers across occupations, and show that this is related to occupational characteristics. For example, occupations that have larger fractions of older workers tend to be less physically demanding and more cognitively demanding. Average workers' characteristics such as cognition and health are strongly correlated with these occupational characteristics, although there is considerable within-occupation heterogeneity. Based on these observations, and a Bartik-type argument, we argue that an increase in the employment share of an occupation with a high fraction of older workers implies an increased demand for older workers. This leads to a prediction that the wages of workers in such occupations may have increased in order to lower retirement rates. Using difference-in-difference methods, we do find evidence for the former, but we do not see a direct relation with retirement. However, an indirect effect through wages is consistent with our results.
{"title":"Sorting into Jobs and Labor Supply and Demand at Older Ages","authors":"M. Angrisani, A. Kapteyn, Erik Meijer","doi":"10.2139/ssrn.3493892","DOIUrl":"https://doi.org/10.2139/ssrn.3493892","url":null,"abstract":"We document considerable heterogeneity in the fraction of older workers across occupations, and show that this is related to occupational characteristics. For example, occupations that have larger fractions of older workers tend to be less physically demanding and more cognitively demanding. Average workers' characteristics such as cognition and health are strongly correlated with these occupational characteristics, although there is considerable within-occupation heterogeneity. Based on these observations, and a Bartik-type argument, we argue that an increase in the employment share of an occupation with a high fraction of older workers implies an increased demand for older workers. This leads to a prediction that the wages of workers in such occupations may have increased in order to lower retirement rates. Using difference-in-difference methods, we do find evidence for the former, but we do not see a direct relation with retirement. However, an indirect effect through wages is consistent with our results.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"26 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2019-11-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"121204861","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
I show that countercyclical earnings risk alone can cause countercyclical consumption risk and generate moderate stock holdings for young households. Moreover, countercyclical earnings risk quantitatively affects savings and portfolio choice decisions over the business cycle. Using the Panel Study of Income Dynamics survey, I construct an empirical measure of earnings risk and investigate how consumption risk and households' portfolio allocations and consumption change in response to earnings risk. My analysis shows that larger downside earnings risk increases consumption risk and reduces risky asset holdings and consumption, which are consistent with the model's predictions. Moreover, countercyclicality in consumption risk is more significant for stockholders than for nonstockholders. Using the flexibility of the model, I find that the elasticity of intertemporal substitution and the expected return of a stock can explain this heterogeneity between stockholders and nonstockholders.
{"title":"Countercyclical Risks and Optimal Life-Cycle Profile: Theory and Evidence","authors":"Jialu Shen","doi":"10.2139/ssrn.3478507","DOIUrl":"https://doi.org/10.2139/ssrn.3478507","url":null,"abstract":"I show that countercyclical earnings risk alone can cause countercyclical consumption risk and generate moderate stock holdings for young households. Moreover, countercyclical earnings risk quantitatively affects savings and portfolio choice decisions over the business cycle. Using the Panel Study of Income Dynamics survey, I construct an empirical measure of earnings risk and investigate how consumption risk and households' portfolio allocations and consumption change in response to earnings risk. My analysis shows that larger downside earnings risk increases consumption risk and reduces risky asset holdings and consumption, which are consistent with the model's predictions. Moreover, countercyclicality in consumption risk is more significant for stockholders than for nonstockholders. Using the flexibility of the model, I find that the elasticity of intertemporal substitution and the expected return of a stock can explain this heterogeneity between stockholders and nonstockholders.","PeriodicalId":111949,"journal":{"name":"Econometric Modeling: Microeconometric Models of Household Behavior eJournal","volume":"21 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2019-10-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"133306030","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
京公网安备 11010802042870号
京ICP备2023020795号-1
扫码关注我们
求助内容：
应助结果提醒方式：