Bommier, Antoine Harenberg, Daniel Le Grand, François
Year of Publication:
Beiträge zur Jahrestagung des Vereins für Socialpolitik 2017: Alternative Geld- und Finanzarchitekturen - Session: Consumption and Household Economics B13-V2
We analyze life-cycle saving strategies with a recursive model that is designed to provide reasonable positive values for the value of a statistical life. With a positive value of life, risk aversion amplifies the impact of uncertain survival on the discount rate, and thus reduces savings. Our model also predicts that risk aversion lowers stock market participation and leads to choose more conservative portfolios.