The Role of Annuitized Wealth in Post-retirement Behavior
Dan Silverman and
American Economic Journal: Macroeconomics, 2018, vol. 10, issue 3, 71-117
This paper develops a tractable model of post-retirement behavior with health status uncertainty and state-verification difficulties. The model distinguishes between annuitized and non-annuitized wealth and features means-tested Medicaid assistance with nursing home care. We show how to solve the potentially complex dynamic problem analytically, making it possible to characterize optimal behavior with phase diagrams. The analysis provides an integrated treatment of portfolio composition and consumption/wealth accumulation choices. We show the model can explain both the "retirement-saving puzzle" and the "annuity puzzle."
JEL-codes: D14 D15 G11 I18 I38 J14 J26 (search for similar items in EconPapers)
Note: DOI: 10.1257/mac.20160343
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
https://www.aeaweb.org/articles/attachments?retrie ... oYU1nBYVjZNgTXF8tmrT (application/zip)
Access to full text is restricted to AEA members and institutional subscribers.
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:aea:aejmac:v:10:y:2018:i:3:p:71-117
Ordering information: This journal article can be ordered from
Access Statistics for this article
American Economic Journal: Macroeconomics is currently edited by Simon Gilchrist
More articles in American Economic Journal: Macroeconomics from American Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Michael P. Albert ().