How changing prudence and risk aversion affect optimal saving

Arbeitspapier

We show how optimal saving in a two-period model is affected when prudence and risk aversion of the underlying utility function change. Increasing prudence alone will induce higher savings only if, for certain combinations of the interest rate and the pure time discount rate, there is distributional neutrality between the two periods. Otherwise, changes of risk aversion that affect the distribution between the periods must also be taken into account.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: CESifo Working Paper ; No. 2438

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Consumer Economics: Theory ; Criteria for Decision-Making under Risk and Uncertainty ; Macroeconomics: Consumption; Saving; Wealth ; Project Evaluation; Social Discount Rate
• Thema: Prudence ; risk aversion ; saving ; intergenerational distribution ; Sparen ; Zeitpräferenz ; Erwartungsnutzen ; Risikoaversion ; Theorie

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Bauer, Christian ; Buchholz, Wolfgang
• Ereignis: Veröffentlichung
• (wer): Center for Economic Studies and ifo Institute (CESifo)
• (wo): Munich
• (wann): 2008

Weitere Informationen

• Handle: http://hdl.handle.net/10419/26483
• Letzte Aktualisierung: 10.03.2025, 11:43 MEZ