Temptation and Commitment: a Model of Hand-to-Mouth Behavior

• 成果类型: Article
• 署名作者: Attanasio, Orazio; Kovacs, Agnes; Moran, Patrick
• 署名单位: Yale University; National Bureau of Economic Research; University of London; King's College London; University of Manchester; University of London; London School Economics & Political Science; Federal Reserve System - USA; Federal Reserve System Board of Governors
• 刊物名称: JOURNAL OF THE EUROPEAN ECONOMIC ASSOCIATION
• ISSN/ISSBN: 1542-4766
• DOI: 10.1093/jeea/jvae016
• 发表日期: 2024
• 页码: 2025-2073
• 关键词: self-control; income changes; consumption; inconsistency; payments; savings; WEALTH; POLICY

摘要

This paper presents a model of consumption behavior that explains the presence of wealthy hand-to-mouth consumers using a mechanism that differs from those analyzed previously. We show that a two-asset model with temptation preferences generates a demand for commitment and thus illiquidity, leading to hand-to-mouth behavior even when liquid assets deliver higher returns than illiquid assets. This preference for illiquidity has important implications for consumption behavior and for fiscal stimulus policies. Our model matches the recent empirical evidence that Marginal Propensity to Consume remain high even for large income shocks, suggesting a larger response to targeted fiscal stimulus than previously believed.