Utility from Accumulation

Louis Kaplow

No 15595, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The possibility that individuals may derive utility from the mere fact of holding wealth has long been recognized. A simple intertemporal model featuring utility from accumulation is used here to examine consumption and savings, the choice between inter vivos gifts and bequests (both to descendants and to charities), and levels of annuitization. Introducing utility from accumulation helps to explain a number of empirical regularities that otherwise seem inconsistent with optimizing behavior. Moreover, because individuals who derive significant utility from accumulation will tend to save more and, in the long run, give more than others do, this source of utility may be especially important in analyzing savings behavior, gifts and bequests, and charitable contributions.

JEL-codes: D11 D14 D91 H31 (search for similar items in EconPapers)
Date: 2009-12
New Economics Papers: this item is included in nep-upt
Note: PE
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

Published as Utility from Accumulation, National Tax Association Proceedings, 102nd Annual Conference 2009, 189-194 (2011).

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