Euler Equations, Subjective Expectations and Income Shocks
Dados Bibliográficos
| ID | 9724596 |
|---|---|
| Autores | Orazio Attanasio (0000-0003-3693-4393, University College London and Institute for Fiscal Studies), Ágnes Kovács (0000-0001-7253-8617, University of Manchester), Krisztina Molnar (0000-0002-5204-5839, Norwegian School of Economics) |
| Ano | 2020 |
| Volume | 87 |
| Fascículo | 346 |
| Páginas | 406-441 |
| Data de publicação | 2020-04-01 |
| Peer Reviewed | Sim |
| Open Access | Sim |
| Tipo | ARTICLE |
| Periódico | Economica (JOURNAL) |
| Identificadores do periódico | ISSN: 0013-0427 • E-ISSN: 1468-0335 |
| Editora | Wiley (PUBLISHER • GB) |
| DOI | 10.1111/ecca.12318 |
| OpenAlex | W2600103385 |
| Idioma | EN |
| Citações recebidas | 1 |
| Referências citadas | 47 |
In this paper, we make three substantive contributions. First, we use elicited subjective income expectations to identify the levels of permanent and transitory income shocks in a lifecycle framework. Second, we use these shocks to assess whether households’ consumption is insulated from them. Third, we use the shock data to estimate an Euler equation for consumption. We find that households are able to smooth transitory shocks, but adjust their consumption in response to permanent shocks, albeit not fully. The estimates of the Euler equation parameters with and without expectational errors are similar, which is consistent with rational expectations. We break new ground by combining data on subjective expectations about future income from the Michigan Survey with microdata on actual income from the Consumer Expenditure Survey
Consumer Expenditure Survey · Consumption (sociology) · Econometrics · Economics · Euler equations · Macroeconomics · Microdata (statistics) · Monetary economics · Permanent income hypothesis · Rational expectations · Shock (circulatory) · Simultaneous equations model · Statistics · Survey data collection · Financial Literacy, Pension, Retirement Analysis · Housing Market and Economics · Mathematics · Monetary Policy and Economic Impact
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Measuring Expectations
The nature of precautionary wealth
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Income Variance Dynamics and Heterogeneity
Consumption Inequality and Partial Insurance
Consumption and Children
Superior Information, Income Shocks, and the Permanent Income Hypothesis
Trends in the covariance structure of earnings in the U.S
Precautionary Saving and the Timing of Taxes
What Can Survey Forecasts Tell Us about Information Rigidities
Asset Holding and Consumption Volatility
Consumption Risk and the Cross Section of Expected Returns
Stochastic Consumption, Risk Aversion, and the Temporal Behavior of Asset Returns
Is Consumption Growth Consistent with Intertemporal Optimization? Evidence from the Consumer Expenditure Survey
Inflation Expectations
The Significance of Federal Taxes as Automatic Stabilizers
| Obras citantes distintas | 1 |
|---|---|
| Citações por ano | 1 |
| Intervalo de citações | 2025 - 2025 (1) |
| Velocidade de citação | recent |
| Altamente citado | Não |
| Tipos de citação | Neutras: 1 |