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Saving Behaviour and the Intergenerational Allocation of Leisure Time

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  • F. Cerina
  • X. Raurich

Abstract

We study how the allocation of leisure time affects savings and working time. To do so, we consider a life-cycle model in which leisure and consumption are complementary and individuals decide on the intertemporal allocation of consumption, on leisure time and on its allocation among individuals of the same generation or of a different one. The latter decision margin determines the equilibrium utility services from leisure that individuals obtain in each life time period. We show that economies in which older individuals obtain higher leisure services have higher savings rates, higher stock of capital per worker and higher fraction of time worked. Using data from the World Value Survey, we provide empirical support to these findings.

Suggested Citation

  • F. Cerina & X. Raurich, 2023. "Saving Behaviour and the Intergenerational Allocation of Leisure Time," Working Paper CRENoS 202315, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    • Handle: RePEc:cns:cnscwp:202315
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    References listed on IDEAS

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    1. Cazzavillan, Guido & Pintus, Patrick, 2007. "Dynamic inefficiency in an overlapping generations economy with production," Journal of Economic Theory, Elsevier, vol. 137(1), pages 754-759, November.
    2. Joan Costa-Font & Paola Giuliano & Berkay Ozcan, 2018. "The cultural origin of saving behavior," PLOS ONE, Public Library of Science, vol. 13(9), pages 1-10, September.
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    4. Elena Del Rey & Miguel-Angel Lopez-Garcia, 2012. "On Welfare Criteria and Optimality in an Endogenous Growth Model," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 14(6), pages 927-943, December.
    5. Laurence J. Kotlikoff, 1989. "What Determines Savings?," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262611872, December.
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    7. Christopher D. Carroll & Byung-Kun Rhee & Changyong Rhee, 1994. "Are There Cultural Effects on Saving? Some Cross-Sectional Evidence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 109(3), pages 685-699.
    8. King, Robert G. & Plosser, Charles I. & Rebelo, Sergio T., 1988. "Production, growth and business cycles : I. The basic neoclassical model," Journal of Monetary Economics, Elsevier, vol. 21(2-3), pages 195-232.
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    More about this item

    Keywords

    overlapping generations; time allocation; Saving behavior; Preferences for leisure;
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