BEGIN:VCALENDAR
VERSION:2.0
PRODID:-//CREST - ECPv5.1.3//NONSGML v1.0//EN
CALSCALE:GREGORIAN
METHOD:PUBLISH
X-WR-CALNAME:CREST
X-ORIGINAL-URL:https://crest.science
X-WR-CALDESC:Events for CREST
BEGIN:VTIMEZONE
TZID:Europe/Helsinki
BEGIN:DAYLIGHT
TZOFFSETFROM:+0200
TZOFFSETTO:+0300
TZNAME:EEST
DTSTART:20190331T010000
END:DAYLIGHT
BEGIN:STANDARD
TZOFFSETFROM:+0300
TZOFFSETTO:+0200
TZNAME:EET
DTSTART:20191027T010000
END:STANDARD
END:VTIMEZONE
BEGIN:VEVENT
DTSTART;TZID=Europe/Helsinki:20190212T121500
DTEND;TZID=Europe/Helsinki:20190212T133000
DTSTAMP:20260713T110521
CREATED:20190208T103651Z
LAST-MODIFIED:20190208T103651Z
UID:12216-1549973700-1549978200@crest.science
SUMMARY:Alan OLIVI (MIT) - "Revealed Preferences and Beliefs from Consumption-Savings Decision" Polytechnique Recruitment
DESCRIPTION:Time: 12:15 pm – 1:30 pmDate: February 12 \, 2019Place: Room 3001\nAlan OLIVI (MIT) – “Revealed Preferences and Beliefs from Consumption-Savings Decision” Polytechnique Recruitment\nAbstract:\nWhat can we robustly infer about preferences and beliefs from the observation of consumption-saving choices? To answer this question\, we study the canonical consumption-savings income fluctuations problem with incomplete markets in the standard Subjective Expected Utility framework. We cast the model in continuous time\, allowing general processes for income and utility. Crucially\, we also allow for general beliefs. Agents can learn over time\, change their beliefs with macroeconomic conditions and\, more importantly\, be systematically biased in an almost unrestricted way. Our main theoretical results provide a novel set of non-parametric identification conditions showing moments of the data that directly reveal preferences and beliefs. Implementing this strategy using data from the PSID and the SIPP\, we find that households are overconfident and overoptimistic. Households underestimate the frequency of shocks\, which constitutes the main source of overconfidence. Their optimism is driven by an underappreciation of negative shocks. These biases are however not homogeneous in the population: they are amplified for lower income households\, while at higher income levels\, perceptions are closer to rational expectations. Quantitatively\, our results explain why the typical household undersaves and overreacts to income shocks but also why higher income households accumulate disproportionately more wealth. We then explore how these beliefs affect the design of unemployment insurance and the transmission of countercyclical income risk to aggregate demand. \n
URL:https://crest.science/event/alan-olivi-mit-revealed-preferences-and-beliefs-from-consumption-savings-decision-polytechnique-recruitment/
CATEGORIES:Economics
END:VEVENT
END:VCALENDAR