The Joy of Giving or Assisted Living? Using Strategic Surveys to Separate Bequest and Precautionary Motives

Abstract

for comments. The views expressed herein are those of the authors rather than of their institutions or the NBER.

Too Risk Averse to Purchase Insurance? A Theoretical Glance at the Annuity Puzzle

“…The discount parameter β > 0 represents the agent's exogenous time preference. This model is very similar to those of De Nardi (2004), De Nardi, French and Jones (2010), Lockwood (2010) and (2011), and Ameriks and al. (2011).…”

“…This is a shortcut for taking into account the agent's altruism, and measuring how the agent cares for his heir. Such a modeling choice for bequests has already been made in the literature, for example by Hurd andSmith (2002), De Nardi (2004), Kopczuk and Lupton (2007), De Nardi, French and Jones (2010), Ameriks, Caplin, Laufer, andVan Nieuwerburgh (2011), Lockwood (2010) and (2011).…”

“…So far, we have not discussed how bequests respond to wealth, since the question we address does not require consideration for heterogeneity in wealth. However, to check that our results do not rely on an implausible wealth elasticity of bequests, we will consider specifications that generate, for a given average bequest, the same wealth elasticities of bequest as in De Nardi (2004), De Nardi, French and Jones (2010), Ameriks et al (2011) andLockwood (2011).…”

Housing Wealth and Household Portfolios in an Ageing Society

“…He suggests that most of the actual bequests are unintended. Ameriks et al (2007) found a stronger role of bequest motives. A second potential explanation for the large wealth holdings of the elderly is the precautionary motive associated with health and mortality risks.…”

“…The important message seems to be that wealth holdings of the elderly can be understood only if health and mortality risks are included in the analysis, or as Coile and Milligan (2006) put it in a recent empirical study: 'factors other than the standard risk and return considerations may weigh heavily in many older households' portfolio decisions' (p. 23). 37 More suggestive evidence is provided in Ameriks et al (2007). For the Dutch situation, recent research by Haffner (2005) confirmed that Dutch households consider home equity more as a resource to be used in case of 'catastrophic events' than as a source of regular supplementary income.…”