Macroeconomic Experience and Precautionary Savings

Projekt Start:01/2018
Forscher:Baptiste Massenot, Giang Nghiem, Nathanael Vellekoop
Kategorie: Macro Finance
Finanziert von:LOEWE

Topic and Objectives

Using a survey of Dutch households, we find that individuals who have experienced higher national unemployment rates over their lifetime save more and borrow less, after controlling for aggregate shocks, income, wealth, and demographics. These results are consistent with experience-based learning and inconsistent with rational learning. Furthermore, these individuals find it more important to save for retirement and are more worried about losing their job. These observations suggest that periods of high unemployment depress aggregate demand because of persistently more pessimistic beliefs.

Zugehörige Working Papers

257Baptiste Massenot, Giang NghiemDepressed Demand2019 Macro Finance