Income and Consumption: A Micro Semistructural Analysis with Pervasive Heterogeneity

• 成果类型: Article
• 署名作者: Alan, Sule; Browning, Martin; Ejrnaes, Mette
• 署名单位: University of Essex; University of Oxford; University of Copenhagen
• 刊物名称: JOURNAL OF POLITICAL ECONOMY
• ISSN/ISSBN: 0022-3808
• DOI: 10.1086/699186
• 发表日期: 2018
• 页码: 1827-1864
• 关键词: risk attitudes; life-cycle; insurance; earnings; parameters; variance; DYNAMICS; aversion; WEALTH

摘要

We develop a model of consumption and income that allows for pervasive heterogeneity in the parameters of both processes. Introducing codependence between household income parameters and preference parameters, we also allow for heterogeneity in the impact of income shocks on consumption. We estimate the parameters of the model using a sample from the Panel Study of Income Dynamics, covering the period 1968-2009. We find considerable codependent heterogeneity in the parameters governing income and consumption processes. Our results suggest a great deal of heterogeneity in the reaction of consumption to income shocks, highlighting the heterogeneity in the self-insurance available to households.