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The Age-Wealth Profile and the Life-Cycle Hypothesis: A Cohort Analysis with Time Series of Cross-Sections of Italian Households

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Author Info
Jappelli, Tullio

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Abstract

In this paper, the author estimates the age-wealth profile under two different identification assumptions about age, cohort, and time effects. According to the life-cycle model, the two sets of assumptions should yield similar age-wealth profiles. Using the 1984-93 Italian Survey of Household Income and Wealth, the estimated average annual rate of wealth decumulation in old age is found to be between 3 and 6 percent. As in the life-cycle model, the cohort effect increases with year of birth. However, the results also uncover considerable population heterogeneity: the rates of wealth decumulation are much lower for rich households and households headed by individuals with higher education. Copyright 1999 by The International Association for Research in Income and Wealth.

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Publisher Info
Article provided by Blackwell Publishing in its journal Review of Income & Wealth.

Volume (Year): 45 (1999)
Issue (Month): 1 (March)
Pages: 57-75
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Handle: RePEc:bla:revinw:v:45:y:1999:i:1:p:57-75

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  1. Richard T. Curtin & Thomas Juster & James N. Morgan, 1989. "Survey Estimates of Wealth: An Assessment of Quality," NBER Chapters, in: The Measurement of Saving, Investment, and Wealth, pages 473-552 National Bureau of Economic Research, Inc. [Downloadable!]
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Cited by:
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  1. Vincent Hildebrand, 2001. "Wealth Accumulation of US Households: What Do We Learn from the SIPP Data?," Social and Economic Dimensions of an Aging Population Research Papers 41, McMaster University. [Downloadable!]
    Other versions:
  2. Deborah A. Cobb-Clark & Vincent Hildebrand, 2003. "The Wealth and Asset Holdings of U.S.-Born and Foreign-Born Households: Evidence from SIPP Data," Social and Economic Dimensions of an Aging Population Research Papers 89, McMaster University. [Downloadable!]
    Other versions:
  3. Andersson, Björn, 2001. "Portfolio Allocation over the Life Cycle: Evidence from Swedish Household Data," Working Paper Series 2001:4, Uppsala University, Department of Economics. [Downloadable!]
  4. Luca Pieroni & David Aristei, 2006. "Regional Differences in Growth Rates: A Microdata Approach," ERSA conference papers ersa06p799, European Regional Science Association. [Downloadable!]
  5. Elin Halvorsen, 2003. "A Cohort Analysis of Household Saving in Norway," Discussion Papers 354, Research Department of Statistics Norway. [Downloadable!]
  6. Arie Kapteyn & Rob Alessie & Annamaria Lusardi, 1999. "Explaining the Wealth Holdings of Different Cohorts: Productivity Growth and Social Security," Tinbergen Institute Discussion Papers 99-069/3, Tinbergen Institute. [Downloadable!]
    Other versions:
  7. Mishra, Ashok & El-Osta, Hisham, 2005. "Wealth Accumulation by Farm Households: Evidence from a National Survey," 2005 Annual meeting, July 24-27, Providence, RI 19573, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association). [Downloadable!]
  8. David McKenzie, 2002. "Distangling Age, Cohort and Time Effects in the Additive Model," Working Papers 02009, Stanford University, Department of Economics. [Downloadable!]
    Other versions:
  9. Katchova, Ani L., 2006. "The Economic Well-Being of Farm and Nonfarm Households: Evidence from Two National Surveys," 2006 Annual meeting, July 23-26, Long Beach, CA 21401, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association). [Downloadable!]
  10. Thomas F. Crossley & Yuri Ostrovsky, 2003. "A Synthetic Cohort Analysis of Canadian Housing Careers," Social and Economic Dimensions of an Aging Population Research Papers 107, McMaster University. [Downloadable!]
  11. Luigi Guiso & Tullio Jappelli, 1999. "Private Transfers, Borrowing Constraints and the Timing of Homeownership," CSEF Working Papers 17, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy. [Downloadable!]
    Other versions:
  12. Tullio Jappelli & Luigi Pistaferri, 2000. "The dynamics of household wealth accumulation in Italy," Fiscal Studies, Institute for Fiscal Studies, vol. 21(2), pages 269-295, June. [Downloadable!]
    Other versions:
  13. Marianna Brunetti, 2007. "Population ageing, household portfolios and financial asset returns: A survey of the literature," Centro Studi di Banca e Finanza (CEFIN) (Center for Studies in Banking and Finance) 07051, Universita di Modena e Reggio Emilia, Facoltà di Economia "Marco Biagi". [Downloadable!]
  14. Massimo Baldini & Paolo Onofri & Carlo Mazzaferro, 2002. "The Reform of Italian Pension System and its Effects on Saving Behaviour," Center for the Analysis of Public Policies (CAPP) 0013, Universita di Modena e Reggio Emilia, Dipartimento di Economia Politica. [Downloadable!]
  15. John K Gibson & Grant M Scobie, 2001. "Household Saving Behaviour in New Zealand: A Cohort Analysis," Treasury Working Paper Series 01/18, New Zealand Treasury. [Downloadable!]
  16. Federico Perali & David Aristei & Luca Pieroni, 2005. "Cohort analysis of alcohol consumption: a double hurdle approach," CHILD Working Papers wp09_05, CHILD - Centre for Household, Income, Labour and Demographic economics - ITALY. [Downloadable!]
  17. Grant M Scobie & John K Gibson, 2003. "Household Saving Behaviour in New Zealand: Why do Cohorts Behave Differently?," Treasury Working Paper Series 03/32, New Zealand Treasury. [Downloadable!]
  18. Halvorsen, Elin, 2003. "A Cohort Analysis of Household Saving in Norway," Memorandum 36/2002, Oslo University, Department of Economics. [Downloadable!]
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