Information acquisition and asset allocation with unknown income growth

Yuanping Wang, Dongfang Wang and Chunxiao Hou

Economics Letters, 2022, vol. 213, issue C

Abstract: We study the learning effects on consumption–portfolio rules with costly financial information acquisition and find that the agent’s acquiring information induces an additional demand for risky asset which is positively related to the degree of uncertainty about the income growth.

Keywords: Information acquisition; Learning; Income growth; Consumption; Risky asset (search for similar items in EconPapers)
JEL-codes: D83 E21 G11 (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:213:y:2022:i:c:s0165176522000519

DOI: 10.1016/j.econlet.2022.110364

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