Husbands Might Really Be That Cheap
AbstractIn this paper, we study the decision to purchase life insurance as part of a lifecycle plan of consumption, savings, and labor supply. Households are subject to idiosyncratic risk in their labor productivity as well as the composition and size of their family, and respond by accumulating savings, working, and purchasing life insurance to hedeg against death of an adult. Using a calibrated general equilibrium model that matches key facts from the income and wealth distribution, we estimate that consumption-smoothing motives produce excessive LI holdings relative to the data, even when load factors consistent with estimates are introduced
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Bibliographic InfoPaper provided by Society for Economic Dynamics in its series 2004 Meeting Papers with number 146.
Date of creation: 2004
Date of revision:
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Postal: Society for Economic Dynamics Christian Zimmermann Economic Research Federal Reserve Bank of St. Louis PO Box 442 St. Louis MO 63166-0442 USA
Web page: http://www.EconomicDynamics.org/society.htm
More information through EDIRC
Life Insurance; Demographics;
Find related papers by JEL classification:
- D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
- D91 - Microeconomics - - Intertemporal Choice - - - Intertemporal Household Choice; Life Cycle Models and Saving
- J17 - Labor and Demographic Economics - - Demographic Economics - - - Value of Life; Foregone Income
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- Jay H. Hong & JosÃ©-VÃctor RÃos-Rull, 2012.
"Life Insurance and Household Consumption,"
American Economic Review,
American Economic Association, vol. 102(7), pages 3701-30, December.
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