Preferences with habit formation
Reexamining the Empirical Relevance of Habit Formation Preferences
... the habit channel and the household income ...the habit channel, while households without large negative income shocks will increase their risky asset shares when they become ...Thus, habit ...
23
Asset Prices Under Habit Formation and Reference-Dependent Preferences
... reference-dependent preferences based on the work of K˝ oszegi and Rabin ...der habit formation and reference-dependent ...and habit formation in explaining asset ...whereas ...
49
Consumption-Leisure Choice with Habit Formation
... time-separable preferences imply that current utility depends only on current consumption, time-non-separable preferences with habit formation im- ply that past real consumption patterns and ...
15
Learning-by-Doing or Habit Formation?
... Habit formation in labour implies that current utility depends on current labour supply relative to a reference level determined by past hours ...that habit-forming agents dislike large swings in ...
33
Saving and Growth with Habit Formation
... in preferences, ...in preferences explain cross-country differences in national saving ...of habit formation in utility could potentially help explain the observed ...
27
Altruistic Behavior and Habit Formation
... Section 2 reviews the previous research on habit formation and altruism. Section 3 describes the data and econometric framework. We present our results in Section 4. Our main finding is that involvement in ...
33
Asset Pricing with Stochastic Habit Formation
... stochastic habit formation in which it is uncertain how deep consumers would become in the habit of consuming in ...chastic habit formation, the optimization problem with stochastic ...
6
Habit formation and the transmission of financial crises
... external habit based on past aggregate consumption (see Abel (1990) and Campbell and Cochrane (1999)) rather than an internal habit based on past own consumption (see Constantinides (1990) and Sundaresan ...
38
Aspirations, Habit Formation, and Bequest Motive
... endogenous preferences aects the altruistic bequest motive from parents to ...aspiration formation could push this value ...and preferences exhibit habit and aspiration ...
28
Welfare Equivalent NNP and Habit Formation
... capital formation for ...of habit forma- tion has been thoroughly addressed 1 ...of habit formation; it may imply that the current instantaneous utility depends on one’s own past consumption ...
7
The equity premium puzzle and habit formation
... The set S reflects our a priori upper bound for γ in the region of 10 (see above) and the usual impatience assumption about preferences which are reflected by a β of less than 1. Additionally, γ and β must be ...
77
Business Cycle Implications of Habit Formation
... with habit forming pref- erences. 1 The recent literature that claims habit formation is important in understanding business cycle and asset pricing puzzles motivates our choice of DSGE ...and ...
44
"Asset Pricing With Multiplicative Habit and Power-Expo Preferences"
... of habit formation have been used in macroeconomics and ...subtractive habit, popularized by Constantinides ...multiplicative habit proposed by Abel ...multiplicative habit model. ...
13
Habit formation, strategic extremism and debt policy
... where habit formation in the voters’ preferences for alternative public goods implies a link from current policies in terms of decisions on the composition of public goods and debt to the probability ...
18
Habit Formation, Parents' Education Spending, and Growth
... We consider an overlapping generations economy where individuals live for two periods and are considered to be “young” or “old”. We assume that each individual works and only consumes when old. Members of each generation ...
10
Habit formation and sunspots in overlapping generations models
... The approach presented in this paper complements the huge literature on general equilib- rium that argues that indeterminacy helps arbitrary self-ful…lling beliefs become a source of volatility, even when ...
25
Term and equity premium in economies with habit formation
... standard preferences is almost one order of magnitude ...standard preferences case. As a consequence, τ is 1.88 under standard preferences which implies a very low equity ...
47
Optimal Nonlinear Income Taxation with Habit Formation
... The main results can be summarised as follows: (i) When the government can pre- commit, the standard optimal marginal tax rate results apply in period 2 simply because this is the last period and contemporaneous ...
22
Notes on Habit Formation and Socially Optimal Growth
... A question that naturally arises is whether habits interact with other types of externalities, and in which direction socially optimal equilibria devi- ate by virtue of time-dependent preferences. In particular, ...
13
Growth, Habit Formation, and Catching-up\ with the Joneses
... when preferences are not time-separable, we show that this convergence could be non-monotonic when the production function exhibits diminishing returns to ...
25