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The Resource Three essays in household finance, Andreas Fagereng

Three essays in household finance, Andreas Fagereng

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Summary
This thesis contains three chapters relating to the field of household finance. In the first chapter household life cycle investment behaviour is investigated using a panel of Norwegian administrative data and tax records. Dealing with selection and identification issues, the data suggests a double adjustment as people age: a rebalancing of the portfolio away from stocks as households approach retirement, and a peak in stock market participation around the time when they reach retirement. A theoretical model predicting these life cycle patterns of investment behavior is then provided. This is achieved by extending existing models with a per period participation cost in risky asset markets and a small perceived probability of being cheated. In the second chapter the relation between household financial asset holdings and unemployment is investigated. Consistent with a simple theoretical model, the data shows increased savings and a shift towards safer assets in the years leading up to unemployment, and depletion of savings during unemployment. This suggests that at least some households can foresee and prepare for upcoming unemployment, which indicates that private savings can complement publicly provided unemployment insurance. The final chapter identifies the causal effect of lump-sum severance payments on non-employment duration in Norway by exploiting a discontinuity in eligibility at age 50. A severance payment worth 1.2 months' earnings lowers the fraction re-employed after one year by six percentage points. This effect is decreasing in wealth, which supports the view that the effect of severance pay should be interpreted as evidence of liquidity constraints. Finding liquidity constraints in Norway, despite its equitable wealth distribution and generous welfare state, suggests they are likely to exist also in other countries
Language
eng
Work
Publication
Extent
vii, 101 pages
Note
Examining Board: Professor Luigi Guiso, supervisor, Einaudi Institute for Economics and Finance; Professor Russell Cooper, European University Institute; Professor Monica Paiella, University of Naples "Parthenope"; Professor Kjell Salvanes, Norwegian School of Economics and Business Administration
Link
http://hdl.handle.net/1814/21720
Instance
Label
Three essays in household finance
Title
Three essays in household finance
Statement of responsibility
Andreas Fagereng
Creator
Contributor
Subject
Language
eng
Summary
This thesis contains three chapters relating to the field of household finance. In the first chapter household life cycle investment behaviour is investigated using a panel of Norwegian administrative data and tax records. Dealing with selection and identification issues, the data suggests a double adjustment as people age: a rebalancing of the portfolio away from stocks as households approach retirement, and a peak in stock market participation around the time when they reach retirement. A theoretical model predicting these life cycle patterns of investment behavior is then provided. This is achieved by extending existing models with a per period participation cost in risky asset markets and a small perceived probability of being cheated. In the second chapter the relation between household financial asset holdings and unemployment is investigated. Consistent with a simple theoretical model, the data shows increased savings and a shift towards safer assets in the years leading up to unemployment, and depletion of savings during unemployment. This suggests that at least some households can foresee and prepare for upcoming unemployment, which indicates that private savings can complement publicly provided unemployment insurance. The final chapter identifies the causal effect of lump-sum severance payments on non-employment duration in Norway by exploiting a discontinuity in eligibility at age 50. A severance payment worth 1.2 months' earnings lowers the fraction re-employed after one year by six percentage points. This effect is decreasing in wealth, which supports the view that the effect of severance pay should be interpreted as evidence of liquidity constraints. Finding liquidity constraints in Norway, despite its equitable wealth distribution and generous welfare state, suggests they are likely to exist also in other countries
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Cataloging source
IT-FiEUI
http://library.link/vocab/creatorName
Fagereng, Andreas
Date time place
Defence date: 23 April 2012
Dissertation note
Thesis (Ph. D.)--European University Institute (ECO), 2012.
Index
no index present
Literary form
non fiction
Nature of contents
theses
http://library.link/vocab/relatedWorkOrContributorName
European University Institute
Series statement
  • EUI PhD theses
  • EUI theses
http://library.link/vocab/subjectName
  • Households
  • Families
Label
Three essays in household finance, Andreas Fagereng
Link
http://hdl.handle.net/1814/21720
Instantiates
Publication
Note
Examining Board: Professor Luigi Guiso, supervisor, Einaudi Institute for Economics and Finance; Professor Russell Cooper, European University Institute; Professor Monica Paiella, University of Naples "Parthenope"; Professor Kjell Salvanes, Norwegian School of Economics and Business Administration
Bibliography note
Includes bibliographical references (pages 95-101)
Carrier category
volume
Carrier category code
  • nc
Carrier MARC source
rdacarrier.
Content category
text
Content type code
  • txt
Content type MARC source
rdacontent.
Control code
FIEb17090878
Dimensions
30 cm.
Extent
vii, 101 pages
Media category
unmediated
Media MARC source
rdamedia.
Media type code
  • n
Other physical details
illustrations
System control number
(OCoLC)851517021
Label
Three essays in household finance, Andreas Fagereng
Link
http://hdl.handle.net/1814/21720
Publication
Note
Examining Board: Professor Luigi Guiso, supervisor, Einaudi Institute for Economics and Finance; Professor Russell Cooper, European University Institute; Professor Monica Paiella, University of Naples "Parthenope"; Professor Kjell Salvanes, Norwegian School of Economics and Business Administration
Bibliography note
Includes bibliographical references (pages 95-101)
Carrier category
volume
Carrier category code
  • nc
Carrier MARC source
rdacarrier.
Content category
text
Content type code
  • txt
Content type MARC source
rdacontent.
Control code
FIEb17090878
Dimensions
30 cm.
Extent
vii, 101 pages
Media category
unmediated
Media MARC source
rdamedia.
Media type code
  • n
Other physical details
illustrations
System control number
(OCoLC)851517021

Subject

Member of

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