The Composition of Household Wealth Over the Life Cycle
Özet
This study analyzes household wealth composition and its changes over the life cycle using comprehensive survey data from the United States. The findings show that asset accumulation has an inverted-V shape over the lifecycle, while debt is front-loaded in working ages. Households accumulate liquid assets for short-term needs and illiquid assets for long-term goals. The study also reveals correlations between age and various wealth indicators, such as debt, asset holdings, and liquidity ratios. Age exhibits a positive correlation with both debt and asset accumulation, in addition to the likelihood of incurring debt and engaging in stock ownership. Conversely, it demonstrates a negative correlation with the ratios of liquid assets to total assets, debt to total assets, and stock to total assets. By utilizing the Panel Study of Income Dynamics (PSID) dataset and econometric approaches, this research contributes to the existing literature on household finance and provides insights into the wealth distribution of low- and middle-income households, which can inform targeted policy initiatives.
Referanslar
Ando, A., & Modigliani, F. (1963). The" Life Cycle" Hypothesis of Saving: Aggregate Implications and Tests. The American Economic Review, 53(1), 55-84.
Bosworth, B., & Anders, S. (2008). Saving and Wealth Accumulation in the PSID, 1984-2005. Available at SSRN 1548512.
Bricker, J., Moore, K. B., & Thompson, J. (2019). Trends in household portfolio composition. In Handbook of US Consumer Economics (pp. 53-96). Academic Press. https://doi.org/10.1016/B978-0-12-813524-2.00003-2
Friedman, M. (1957). The permanent income hypothesis. In A theory of the consumption function (pp. 20-37). Princeton University Press.
Guo, S., & Hardin, W. G. (2014). Wealth, composition, housing, income and consumption. The Journal of Real Estate Finance and Economics, 48, 221-243. https://doi.org/10.1007/s11146-012-9390-z
McCarthy, D. (2004, February). Household portfolio allocation: A review of the literature. In Economic and Social Research Institute of the Japan Cabinet Office conference on the international collaboration projects.
Mian, A., Rao, K., & Sufi, A. (2013). Household balance sheets, consumption, and the economic slump. The Quarterly Journal of Economics, 128(4), 1687-1726. https://doi.org/10.1093/qje/qjt020
Poterba, J. & Samwick, A. (2001). 2. Household Portfolio Allocation over the Life Cycle. In S. Ogura, T. Tachibanaki & D. Wise (Ed.), Aging Issues in the United States and Japan (pp. 65-104). Chicago: University of Chicago Press. https://doi.org/10.7208/9780226620831-004
Szymborska, H. K. (2019). Wealth structures and income distribution of US households before and after the Great Recession. Structural change and economic dynamics, 51, 168-185. https://doi.org/10.1016/j.strueco.2019.08.011
Wolff, E. N. (2016). Household wealth trends in the United States, 1962 to 2013: What happened over the great recession?. RSF: The Russell Sage Foundation Journal of the Social Sciences, 2(6), 24-43.
Wolff, E. N. (2021). Household Wealth Trends in the United States, 1962 to 2019: Median Wealth Rebounds... But Not Enough. NBER Working Paper, (w28383).
Yilmazer, T., & DeVaney, S. A. (2005). Household debt over the life cycle. Financial Services Review, 14(4), 285-304.
Referanslar
Ando, A., & Modigliani, F. (1963). The" Life Cycle" Hypothesis of Saving: Aggregate Implications and Tests. The American Economic Review, 53(1), 55-84.
Bosworth, B., & Anders, S. (2008). Saving and Wealth Accumulation in the PSID, 1984-2005. Available at SSRN 1548512.
Bricker, J., Moore, K. B., & Thompson, J. (2019). Trends in household portfolio composition. In Handbook of US Consumer Economics (pp. 53-96). Academic Press. https://doi.org/10.1016/B978-0-12-813524-2.00003-2
Friedman, M. (1957). The permanent income hypothesis. In A theory of the consumption function (pp. 20-37). Princeton University Press.
Guo, S., & Hardin, W. G. (2014). Wealth, composition, housing, income and consumption. The Journal of Real Estate Finance and Economics, 48, 221-243. https://doi.org/10.1007/s11146-012-9390-z
McCarthy, D. (2004, February). Household portfolio allocation: A review of the literature. In Economic and Social Research Institute of the Japan Cabinet Office conference on the international collaboration projects.
Mian, A., Rao, K., & Sufi, A. (2013). Household balance sheets, consumption, and the economic slump. The Quarterly Journal of Economics, 128(4), 1687-1726. https://doi.org/10.1093/qje/qjt020
Poterba, J. & Samwick, A. (2001). 2. Household Portfolio Allocation over the Life Cycle. In S. Ogura, T. Tachibanaki & D. Wise (Ed.), Aging Issues in the United States and Japan (pp. 65-104). Chicago: University of Chicago Press. https://doi.org/10.7208/9780226620831-004
Szymborska, H. K. (2019). Wealth structures and income distribution of US households before and after the Great Recession. Structural change and economic dynamics, 51, 168-185. https://doi.org/10.1016/j.strueco.2019.08.011
Wolff, E. N. (2016). Household wealth trends in the United States, 1962 to 2013: What happened over the great recession?. RSF: The Russell Sage Foundation Journal of the Social Sciences, 2(6), 24-43.
Wolff, E. N. (2021). Household Wealth Trends in the United States, 1962 to 2019: Median Wealth Rebounds... But Not Enough. NBER Working Paper, (w28383).
Yilmazer, T., & DeVaney, S. A. (2005). Household debt over the life cycle. Financial Services Review, 14(4), 285-304.
