Estimating Discount Functions with Consumption Choices Over the Lifecycle PDF Download

Author: David I. Laibson
Publisher:
ISBN:
Category : Consumption (Economics)
Languages : en
Pages : 64

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Book Description
Intertemporal preferences are difficult to measure. We estimate time preferences using a structural buffer stock consumption model and the Method of Simulated Moments. The model includes stochastic labor income, liquidity constraints, child and adult dependents, liquid and illiquid assets, revolving credit, retirement, and discount functions that allow short-run and long-run discount rates to differ. Data on retirement wealth accumulation, credit card borrowing, and consumption-income comovement identify the model. Our benchmark estimates imply a 40% short-term annualized discount rate and a 4.3% long-term annualized discount rate. Almost all specifications reject the restriction to a constant discount rate. Our quantitative results are sensitive to assumptions about the return on illiquid assets and the coefficient of relative risk aversion. When we jointly estimate the coefficient of relative risk aversion and the discount function, the short-term discount rate is 15% and the long-term discount rate is 3.8%.

Author: Christopher Tsoukis
Publisher: Oxford University Press
ISBN: 0192559214
Category : Business & Economics
Languages : en
Pages : 512

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Book Description
Theory of Macroeconomic Policy reviews the theoretical foundations of macroeconomic, fiscal, and monetary, policy. It offers a panoramic view of macroeconomic theory, covering a wide range of topics that are not customarily dealt with in macroeconomics texts, as well as more standard material. Advanced theory is bridged with more elementary or intermediate material, and established models are reviewed alongside current research directions. There is an extensive review of empirical evidence on virtually every topic, supplemented by narrative accounts for various episodes. The policy implications of the various theories are emphasised throughout. The chapters are largely self-contained so that different courses can focus at different places. A 'Guidance for Further Study' Section and extensive bibliography give plenty of ideas for all levels of independent study, from Undergraduate Projects to MSc Dissertations to PhD Theses. Theory of Macroeconomic Policy presents a balance between: breadth as well as depth; analytical treatment and intuition; theory and evidence; vintage theories and current directions; theory and policy; (established) theory and debate. Theory of Macroeconomic Policy is an affirmation that there is a well-developed body of theory that is invaluable for an in-depth understanding of the macro-economy and policy; equally, there is much scope for critical discussion and debate.

Author: Shinsuke Ikeda
Publisher: Springer
ISBN: 4431557938
Category : Business & Economics
Languages : en
Pages : 204

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Book Description
Based on recent advances in economics, especially those in behavioral economics, this book elucidates theoretically and empirically the mechanism of time-inconsistent decision making that leads to various forms of self-destructive behavior. The topics include over-eating and obesity, over-spending, over-borrowing, under-saving, procrastination, smoking, gambling, over-drinking, and other intemperate behaviors, all of which relate to serious social problems in advanced countries. In this book, the author attempts to construct a bridge between the basic theory of time discounting, especially as of hyperbolic discounting, and empirically observed “irrational (non-classical)” behavior in the various contexts just mentioned. The empirical validity of the theory is discussed using unique micro data as well as public macro data. The book proposes prescriptions for individual decision makers, whether sophisticated or naïve, to make better choices in self-control problems, and also provides policy makers with useful advice for influencing people’s decision making in the right directions. This work is recommended not only to general readers who seek to learn how to attain better self-regulation under self-control problems. It also helps researchers who seek an overview of positive and normative implications of hyperbolic discounting, and thereby reconstruct economic theory for a better understanding of actual human behavior and the resulting economic dynamics .

Author: Sanjit S. Dhami
Publisher: Oxford University Press
ISBN: 0198715528
Category : Business & Economics
Languages : en
Pages : 1799

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Book Description
It considers the evidence against the exponential discounted utility model and describes several behavioral models such as hyperbolic discounting, attribute based models and the reference time theory. Part IV describes the evidence on classical game theory and considers several models of behavioral game theory, including level-k and cognitive hierarchy models, quantal response equilibrium, and psychological game theory. Part V considers behavioral models of learning that include evolutionary game theory, classical models of learning, experience weighted attraction model, learning direction theory, and stochastic social dynamics. Part VI studies the role of emotions; among other topics it considers projection bias, temptation preferences, happiness economics, and interaction between emotions and cognition. Part VII considers bounded rationality. The three main topics considered are judgment heuristics and biases, mental accounting, and behavioral finance.

Author: Sanjit Dhami
Publisher: Oxford University Press
ISBN: 0192574663
Category : Business & Economics
Languages : en
Pages : 270

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Book Description
Taken from the first definitive introduction to behavioral economics, The Foundations of Behavioral Economic Analysis: Behavioral Time Discounting is an authoritative and cutting edge guide to this essential topic for advanced undergraduate and postgraduate students. It considers the evidence against the exponential discounted utility model and describes several behavioral models such as hyperbolic discounting, attribute based models, and the reference time theory. This updated extract from Dhami's leading textbook allows the reader to pursue subsections of this vast and rapidly growing field and to tailor their reading to their specific interests in behavioural economics.

Author: Michal Skorepa
Publisher: Bloomsbury Publishing
ISBN: 1137285656
Category : Business & Economics
Languages : en
Pages : 400

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Book Description
Decision Making provides a broad survey of the field of decision making from the perspective of the economics researcher. The book is divided into two parts, the first provides a concise and systematic overview of the field of decision research, and the second goes deeper into key topics and debates within the field.

Author: Morris Altman
Publisher: Edward Elgar Publishing
ISBN: 1839107944
Category : Business & Economics
Languages : en
Pages : 533

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Book Description
This comprehensive Handbook addresses a wide variety of methodological approaches adopted and developed by behavioural economists, exploring the implications of such innovations for analysis and policy.

Author: Edward Cartwright
Publisher: Routledge
ISBN: 1351600028
Category : Business & Economics
Languages : en
Pages : 620

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Book Description
Over the last few decades behavioral economics has revolutionized the discipline. It has done so by putting the human back into economics, by recognizing that people sometimes make mistakes, care about others and are generally not as cold and calculating as economists have traditionally assumed. The results have been exciting and fascinating, and have fundamentally changed the way we look at economic behavior. This textbook introduces all the key results and insights of behavioral economics to a student audience. Ideas such as mental accounting, prospect theory, present bias, inequality aversion and learning are explained in detail. These ideas are also applied in diverse settings such as auctions, stock market crashes, charitable donations and health care, to show why behavioral economics is crucial to understanding the world around us. Consideration is also given to what makes people happy, and how we can potentially nudge people to be happier. This new edition contains expanded and updated coverage of contract theory, bargaining in the family, time and risk, and stochastic reference points, among other topics, to ensure that readers are kept up to speed with this fast-paced field. The companion website is also updated with a range of new questions and worked examples. This book remains the ideal introduction to behavioral economics for advanced undergraduate and graduate students.

Author: Harvard Law Review
Publisher: Quid Pro Books
ISBN: 161027878X
Category : Law
Languages : en
Pages : 430

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Book Description
The contents of Number 6 (Apr. 2014) include scholarly articles and student research, as well as as the extensive, annual survey of Developments in the Law. This year's subject is SEXUAL ORIENTATION AND GENDER IDENTITY. Topics include "Pro-Gay and Anti-Gay Speech in Schools," "Transgender Youth and Access to Gendered Spaces in Education," "Classification and Housing of Transgender Inmates in American Prisons," "Animus and Sexual Regulation," and "Progress Where You Might Least Expect It: The Military's Repeal of 'Don't Ask, Don't Tell.'" Each year, the special Developments issue serves, in effect, as a new and detailed book on a cutting-edge legal subject. The issue also includes an article by Jill C. Anderson, "Misreading Like a Lawyer: Cognitive Bias in Statutory Interpretation," and an article by Ryan Bubb & Richard H. Pildes, "How Behavioral Economics Trims Its Sails and Why." In addition, student case notes explore Recent Cases on such diverse subjects as false advertising by disseminating scientific literature, free speech rights of professors in public universities, voter identification laws, sentencing by imposing the condition of penile plethysmography, aiding and abetting violations in international law, and whether intercepting unencrypted wi-fi violates the Wiretap Act. A further student work explores the recent administrative policy of the Social Security Administration's eliminating a surgical requirement for changing trans individuals' gender designation, and another explores a recent administration white paper on national security and whether bulk metadata collection violates the USA PATRIOT Act. Finally, the issue features several summaries of Recent Publications. The Harvard Law Review is offered in a quality digital edition, featuring active Contents, linked notes, active URLs in notes, and proper ebook and Bluebook formatting. The contents of Number 6 (Apr. 2014) include scholarly essays by leading academic figures, as well as substantial student research. The Review is a student-run organization whose primary purpose is to publish a journal of legal scholarship. The organization is formally independent of the Harvard Law School. Student editors make all editorial and organizational decisions.

Author: Michelle Baddeley
Publisher: Routledge
ISBN: 1351813986
Category : Business & Economics
Languages : en
Pages : 461

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Book Description
Behavioural economics and behavioural finance are rapidly expanding fields that are continually growing in prominence. While orthodox economic models are built upon restrictive and simplifying assumptions about rational choice and efficient markets, behavioural economics offers a robust alternative using insights and evidence that rest more easily with our understanding of how real people think, choose and decide. This insightful textbook introduces the key concepts from this rich, interdisciplinary approach to real-world decision-making. This new edition of Behavioural Economics and Finance is a thorough extension of the first edition, including updates to the key chapters on prospect theory; heuristics and bias; time and planning; sociality and identity; bad habits; personality, moods and emotions; behavioural macroeconomics; and well-being and happiness. It also includes a number of new chapters dedicated to the themes of incentives and motivations, behavioural public policy and emotional trading. Using pedagogical features such as chapter summaries and revision questions to enhance reader engagement, this text successfully blends economic theories with cutting-edge multidisciplinary insights. This second edition will be indispensable to anyone interested in how behavioural economics and finance can inform our understanding of consumers’ and businesses’ decisions and choices. It will appeal especially to undergraduate and graduate students but also to academic researchers, public policy-makers and anyone interested in deepening their understanding of how economics, psychology and sociology interact in driving our everyday decision-making.