Consumption smoothing and liquidity income redistribution

  • We show theoretically that income redistribution benefits borrowingconstrained individuals more than is implied by standard relative-income and uninsurable-risk considerations. Empirically, we find in international opinion-survey data that younger and lower-income individuals express stronger support for government redistribution in countries where consumer credit is less easily available. This evidence supports our theoretical perspective if such individuals are more strongly affected by tighter credit supply, in that expectations of higher incomes in the future increase their propensity to borrow. JEL Classification: E21

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Metadaten
Author:Giuseppe Bertola, Winfried KoenigerORCiDGND
URN:urn:nbn:de:hebis:30-38088
Parent Title (German):Center for Financial Studies (Frankfurt am Main): CFS working paper series ; No. 2006,34
Series (Serial Number):CFS working paper series (2006, 34)
Document Type:Working Paper
Language:English
Year of Completion:2006
Year of first Publication:2006
Publishing Institution:Universit├Ątsbibliothek Johann Christian Senckenberg
Release Date:2007/02/23
Tag:Consumption; Smoothing
GND Keyword:Einkommen; Konsumentenkredit
Issue:November 2006
Page Number:34
HeBIS-PPN:190330236
Institutes:Wissenschaftliche Zentren und koordinierte Programme / Center for Financial Studies (CFS)
Dewey Decimal Classification:3 Sozialwissenschaften / 33 Wirtschaft / 330 Wirtschaft
Licence (German):License LogoDeutsches Urheberrecht