Asset Accumulation, Information, and the Life Cycle / Mervyn A. King, Jonathan I. Leape.

Format:

Book

Author/Creator:

King, Mervyn A.

Contributor:

National Bureau of Economic Research.

Leape, Jonathan I.

Series:

Working Paper Series (National Bureau of Economic Research) no. w2392.

NBER working paper series no. w2392

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1987.

Summary:

Empirical tests of the life cycle model have focused on its implications for the level of a household's total net worth and paid little attention to changes in portfolio composition over the life cycle. In this paper, we examine a new survey of the asset holdings of 6,010 U.S households and show that there is a pronounced life-cycle pattern to both the number and value of assets held by U.S. households. Direct survey evidence suggests that incomplete information is a significant determinant of household portfolio composition. We test the hypothesis that information about investment opportunities arrives stochastically over time, estimating a Poisson model for the arrival of new information.

Notes:

Print version record

September 1987.