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Wealth Effects with Endogenous Retirement

Author

Listed:
  • Borys Grochulski
  • Yuzhe Zhang

Abstract

In this article, we study wealth effects, i.e., the response of consumption to exogenous changes in wealth. We use a consumption-saving model with endogenous retirement to show that the endogenous response of the value of a worker's human capital to changes in her wealth helps to account for the weak wealth effects observed in the data.

Suggested Citation

  • Borys Grochulski & Yuzhe Zhang, 2019. "Wealth Effects with Endogenous Retirement," Economic Quarterly, Federal Reserve Bank of Richmond, issue 3Q, pages 173-200.
    • Handle: RePEc:fip:fedreq:00069
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    References listed on IDEAS

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