Private Wealth over the Life-Cycle: A Meeting between Microsimulation and Structural Approaches

Lino Galiana and Lionel Wilner

Documents de Travail de l'Insee - INSEE Working Papers from Institut National de la Statistique et des Etudes Economiques

Abstract: This paper embeds a structural model of private wealth accumulation over the life-cycle within a dynamic microsimulation model (Destinie 2) designed for long-run projections of pensions. In such an environment, the optimal savings path results from consumption smoothing and bequests motives, on top of the mortality risk. Preferences are estimated based on a longitudinal wealth survey through a method of simulated moments. Simulations issued from these estimations replicate quite well a private wealth that is more concentrated than labor income. They enable us to compute augmented standards of living including capital income, hence to quantify both the countervailing role played by private wealth to earnings dropout after retirement and the impact of the mortality risk in this regard.

Keywords: Microsimulation; Intertemporal Consumer Choice; Life-cycle; Inequality (search for similar items in EconPapers)
JEL-codes: C63 C88 D15 (search for similar items in EconPapers)
Date: 2023
New Economics Papers: this item is included in nep-age, nep-cmp, nep-dge and nep-inv
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https://www.bnsp.insee.fr/ark:/12148/bc6p07pz2kz/f1.pdf Document de travail de la DESE numero 2023/04 (application/pdf)

Related works:
Journal Article: Private Wealth Over the Life Cycle: A Meeting Between Microsimulation and Structural Approaches (2025)
Working Paper: Private Wealth Over the Life Cycle: A Meeting Between Microsimulation and Structural Approaches (2024)
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Persistent link: https://EconPapers.repec.org/RePEc:nse:doctra:2023-04

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