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Wealth Accumulation of US Households: What do we learn from the SIPP data?

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  • Hildebrand, Vincent

    (York University, Canada and CEPS/INSTEAD, Luxembourg)

Abstract

In this paper, I estimate, for US households, age-wealth profiles which allow for cohort effects. I use these to reexamine one of the central empirical propositions simple life-cycle models: dissaving after retirement. The analysis employs a data set which has not been previously examined in this way: the Survey of Income and Program Participation (SIPP). The main regression results suggest that elderly households do not dissave after retirement. However, an examination of the distribution of wealth at retirement reveals that most households have accumulated very little wealth from which to dissave. Given that about 40% of households are not covered by any occupational pension, social security payments are the main source retirement income for a large number of households. Even more than the absence of post-retirement dissaving, it is this overall lack of pre-retirement saving which seems to contradict standard life-cycle models.

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Bibliographic Info

Paper provided by IRISS at CEPS/INSTEAD in its series IRISS Working Paper Series with number 2001-01.

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Date of creation: Apr 2001
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Handle: RePEc:irs:iriswp:2001-01

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Keywords: Wealth Accumulation ; Life Cycle Models ; Cohort Analysis;

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References

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  1. Orazio P. Attanasio & Hilary Williamson Hoynes, 2000. "Differential Mortality and Wealth Accumulation," Journal of Human Resources, University of Wisconsin Press, vol. 35(1), pages 1-29.
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Cited by:
  1. Han, Chang-Keun & Sherraden, Michael, 2009. "Do institutions really matter for saving among low-income households? A comparative approach," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(3), pages 475-483, June.
  2. Barry P. Bosworth & Ralph C. Bryant & Gary Burtless, 2004. "The Impact of Aging on Financial Markets and the Economy: A Survey," Working Papers, Center for Retirement Research at Boston College 2004-23, Center for Retirement Research.

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