کد مقاله | کد نشریه | سال انتشار | مقاله انگلیسی | نسخه تمام متن |
---|---|---|---|---|
985713 | 1480837 | 2008 | 13 صفحه PDF | دانلود رایگان |
![عکس صفحه اول مقاله: Aggregate savings when individual income varies Aggregate savings when individual income varies](/preview/png/985713.png)
This paper examines aggregate savings in a general equilibrium model where infinitely lived households face volatile (and possibly uncertain) income paths, hold a risk-free asset, and face a borrowing constraint. I first show that the equilibrium capital stock in an economy without uncertainty, but where individual income varies, can be larger than in an economy where each household's income is constant. When individual income is stochastic and uninsurable, the equilibrium capital stock is always larger than when income is constant. This additional capital accumulation has sometimes been interpreted as precautionary savings, but I argue that much of the additional savings are generated by permanent-income motives in combination with strict borrowing constraints.
Journal: Review of Economic Dynamics - Volume 11, Issue 1, January 2008, Pages 70–82