Exponential-Growth Bias and Lifecycle Consumption
نویسندگان
چکیده
منابع مشابه
Exponential Growth Bias and Household Finance
We document two widespread biases in how consumers perceive the costs and benefits of borrowing and saving, and explore the implications of these biases for household finance. Payment/interest bias is the systematic tendency to underestimate a loan interest rate given other loan terms. Future value bias is the systematic tendency to underestimate a future value given a present value, time horiz...
متن کاملExponential Growth Bias and Financial Literacy
Exponential Growth Bias and Financial Literacy The tendency to underestimate the future value of a variable growing at a constant rate, an example of exponential growth bias, has been linked to household financial decision making. We show that exponential growth bias and standard measures of financial literacy are negatively correlated in a representative sample of Swedish adults. Since financi...
متن کاملEarnings, consumption and lifecycle choices
We discuss recent developments in the literature that studies how the dynamics of earnings and wages affect consumption choices over the life cycle. We start by analyzing the theoretical impact of income changes on consumption highlighting the role of persistence, information, size and insurability of changes in economic resources. We next examine the empirical contributions, distinguishing bet...
متن کاملEstimating Discount Functions from Lifecycle Consumption Choices
This paper uses Þeld evidence and a structural consumption-savings model to estimate discount functions. Evidence on wealth accumulation implies that people act patiently when considering long-term decisions, while data on credit card borrowing and consumption-income comovement suggests impatient behavior in the short term. Using the Method of Simulated Moments we estimate an institutionally ri...
متن کاملNews Consumption and Media Bias
B in the market for news is well-documented. Recent research in economics explains the phenomenon by assuming that consumers want to read (watch) news that is consistent with their tastes or prior beliefs rather than the truth. The present paper builds on this idea but recognizes that (i) besides “biased” consumers, there are also “conscientious” consumers whose sole interest is in discovering ...
متن کاملذخیره در منابع من
با ذخیره ی این منبع در منابع من، دسترسی به آن را برای استفاده های بعدی آسان تر کنید
ژورنال
عنوان ژورنال: SSRN Electronic Journal
سال: 2012
ISSN: 1556-5068
DOI: 10.2139/ssrn.2144358