The Consumption Response to Seasonal Income: Evidence from Japanese Public Pension Benefits

Melvin Stephens and Takashi Unayama

No 16342, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Japanese public pension benefits, which were distributed quarterly through February 1990 and every other month since then, induce substantial but predictable income fluctuations. The relative magnitude of the payments combined with the delay between payments yields a stronger test of the Life-Cycle/Permanent Income Hypothesis than in prior studies. Applying two identification strategies to monthly household panel data, we find that consumption significantly responds to quarterly benefit receipt. Additional analysis suggests that our findings cannot be explained by either liquidity constraints or precautionary savings motives.

JEL-codes: E21 H55 (search for similar items in EconPapers)
Date: 2010-09
Note: ME PE
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

Published as Melvin Stephens & Takashi Unayama, 2011. "The Consumption Response to Seasonal Income: Evidence from Japanese Public Pension Benefits," American Economic Journal: Applied Economics, American Economic Association, vol. 3(4), pages 86-118, October.

Downloads: (external link)
http://www.nber.org/papers/w16342.pdf (application/pdf)

Related works:
Journal Article: The Consumption Response to Seasonal Income: Evidence from Japanese Public Pension Benefits (2011)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:16342

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w16342

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().