Corporate Savings and Shareholder Consumption / Alan J. Auerbach, Kevin Hassett.

Format:

Book

Author/Creator:

Auerbach, Alan J.

Contributor:

National Bureau of Economic Research.

Hassett, Kevin.

Series:

Working Paper Series (National Bureau of Economic Research) no. w2994.

NBER working paper series no. w2994

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1989.

Summary:

This paper reexamines the implications of changing corporate savings, testing for the presence of a "corporate veil". We argue that previous tests for such s veil have lacked proper focus, identifying influences of corporate saving on private saving that are entirely consistent with a complete piercing of the corporate veil. We formulate two tests. Results based on the first find that wealth-neutral changes In corporate dividend policy do not significantly affect aggregate consumption, suggesting that no corporate veil exists, The second test finds the aggregate consumption response to changes in corporate wealth is close to zero, consistent with the presence of a veil but also with heterogeneity in the population with respect to consumption behavior.

Notes:

Print version record

June 1989.