This article represents the first U.S. study employing exclusively household-level longitudinal data spanning the Great Recession to estimate the response of household spending to negative wealth shocks induced by the sharp declines in house prices.
The government shutdown highlighted the lack of resilience many suffer from when they encounter unexpected economic events. The median American family has been losing ground for decades. Policy responses to address this situation will be complex and difficult, but are much needed.
The results of this paper show a strong empirical relevance of subjective survival curves, indicating the importance to take into consideration of this dimension of individual heterogeneity in life cycle models.
While Oxfam reports have done a good job of bringing attention to the problem of inequality, they may give the false impression that global inequality has been rising instead of falling. Global inequality has actually been on the decline while inequality within the developed world is increasing.
In Bourgeois Equality, economist and historian Deirdre McCloskey advances the theory that ideas — not capital, institutions, innovation, R&D, tax policy, monetary policy, or regulatory policy — are the propelling force behind economic and societal growth.
Saving early for retirement is critical, but it's also important to stay on track during job changes. Younger workers tend to change jobs often, and if they cash out of their plans with each position, that can affect their long-term savings.
Research has fueled concerns about how income inequality drives inequality of opportunity. Commonsense approaches such as improvements in education and access to quality health care have been shown to provide young people with better opportunities.
Low interest rates mandated by the Federal Reserve may have had and possibly continue to have adverse effects on income inequality. Those who argue for continuing near-zero short-term interest rate policy should be cognizant of this.
Financial advisers can play an important role with helping individuals make better financial decisions and improving their financial situations. But does working with a financial adviser improve savings behavior, particularly saving for retirement?
In 1997, Mexico transformed its pay-as-you-go social security system to a fully funded system with personal retirement accounts, including management fees. This article examines changes in retirement wealth resulting from this new system.
The value of health lost, not just monetary cost, may partially explain why the wealthy consume more healthy and only moderately unhealthy goods, but fewer very unhealthy goods. Rich people tend to be healthy.
Today, Democrats are more than six times likelier than Republicans to believe the U.S. government should play a role in reducing income inequality. This is not due to differences in age, gender, education, or income distributions among the two parties.
Video compilation of the 2014 Behavioral Finance (BeFi) Forum in Washington, D.C., a day-long event that included a series of topical panels on curated presentations of academic research followed by discussion by leading researchers, practitioners, and policymakers.