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Journal ArticleDOI

Liquidity Considerations in the Theory of Consumption

TLDR
In this article, the optimal consumption plan and optimal portfolio liquidity structure are discussed. But the model and optimality conditions for optimal consumption are not considered. And they do not consider the impact of portfolio liquidity on the portfolio's performance.
Abstract
I. Introduction, 279.—II. The model and optimality conditions, 281.—III. The optimal consumption plan, 284.—IV. Implications of the portfolio liquidity structure, 288.—V. Conclusions, 293.

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Journal ArticleDOI

Consumption and Liquidity Constraints: An Empirical Investigation

TL;DR: In this article, the authors test the permanent income hypothesis against the alternative hypothesis that consumers optimize subject to a well-specified sequence of borrowing constraints, and the results generally support the hypothesis that an inability to borrow against future labor income affects the consumption of a significant portion of the population.
Journal ArticleDOI

Why do so Few Hold Stocks

TL;DR: The authors investigate why 75 percent of U.S. households do not hold stocks despite the equity premium and predictions of expected-utility models and show that risk aversion per se, heterogeneity of beliefs, habit persistence, time nonseparability, and quantity constraints on borrowing do not account for the phenomenon.
Journal ArticleDOI

Stock Market Wealth and Consumption

TL;DR: In this paper, the authors explored the link between changes in the aggregate value of corporate stock and changes in consumer spending and found that after a change in stock market values, consumer spending is likely to rise by between one and two cents for each dollar increase in the value of stock.
Posted Content

Consumption and Saving: Models of Intertemporal Allocation and Their Implications for Public Policy

TL;DR: A critical survey of the large literature on the life cycle model of consumption, both from an empirical and a theoretical point of view, is provided in this article, where several approaches have been taken in the literature to bring the model to the data, their empirical successes and failures.
ReportDOI

Consumption and Saving: Models of Intertemporal Allocation and Their Implications for Public Policy

TL;DR: A critical survey of the large literature on the life cycle model of consumption, both from an empirical and a theoretical point of view, is provided in this paper, where several approaches have been taken in the literature to bring the model to the data, their empirical successes, and their failures.