This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

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

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Jappelli, Tullio

Additional information is available for the following registered author(s):

Abstract

Existing estimates of the age-wealth profile use panel or cross-sectional data. Panels with wealth data are rare, and plagued by measurement errors and sample attrition. Cross-sectional data require strong identifying assumptions. This paper represents the first attempt to use repeated cross-sectional data to test one of the central implications of the life-cycle theory, i.e. the extent to which the elderly run down accumulated assets. Using the 1984-93 Italian Survey of Household Income and Wealth, the paper shows that failing to control for the influence of cohort effects leads to substantial bias in the estimate of the age-wealth profile. Once cohort effects are taken into account, the results indicate that households accumulate assets until they are 70 years old; afterwards the estimated average annual rate of wealth decumulation is about 6%. A basic prediction of the life-cycle model, that the cohort effect increases from older to younger cohorts, is strongly supported by the data. 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.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help file. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.cepr.org/pubs/dps/DP1251.asp
File Format: application/pdf
File Function:
Download Restriction: CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Publisher Info
Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 1251.

Download reference. The following formats are available: HTML, plain text, BibTeX, RIS (EndNote), ReDIF
Length:
Date of creation: Oct 1995
Date of revision:
Handle: RePEc:cpr:ceprdp:1251

Contact details of provider:
Postal: Centre for Economic Policy Research, 53--56 Great Sutton Street, London EC1V 0DG
Phone: 44 - 20 - 7183 8801
Fax: 44 - 20 - 7183 8820

Order Information:
Email:

For technical questions regarding this item, or to correct its listing, contact: ().

Related research
Keywords: Life-cycle Model Repeated Cross-sections Wealth Accumulation

Other versions of this item:

Find related papers by JEL classification:
E21 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. 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!]
  2. 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:
  3. 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 Salerno, Italy. [Downloadable!]
    Other versions:
  4. 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:
  5. 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:
  6. 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!]
  7. 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!]
  8. Luca Pieroni & David Aristei, 2006. "Regional Differences in Growth Rates: A Microdata Approach," ERSA conference papers ersa06p799, European Regional Science Association. [Downloadable!]
  9. Elin Halvorsen, 2003. "A Cohort Analysis of Household Saving in Norway," Discussion Papers 354, Research Department of Statistics Norway. [Downloadable!]
  10. 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:
  11. 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!]
  12. M. Baldini & C. Mazzaferro, 2000. "Transizione demografica e formazione del risparmio delle famiglie italiane," Working Papers 366, Dipartimento Scienze Economiche, Università di Bologna. [Downloadable!]
  13. 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!]
  14. David McKenzie, 2002. "Distangling Age, Cohort and Time Effects in the Additive Model," Working Papers 02009, Stanford University, Department of Economics. [Downloadable!]
    Other versions:
  15. 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!]
  16. 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!]
  17. Halvorsen, Elin, 2003. "A Cohort Analysis of Household Saving in Norway," Memorandum 36/2002, Oslo University, Department of Economics. [Downloadable!]
Statistics
Access and download statistics

Did you know? IDEAS also indexes books.

This page was last updated on 2008-10-11.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.