Retirement in the Shadow (Banking)

Guillermo Ordonez and Facundo Piguillem

No 26337, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The U.S. economy has recently experienced two, seemingly unrelated, phenomena: a large increase in post-retirement life expectancy and a major expansion in securitization and shadow banking activities. We argue they are intimately related. Agents rely on financial intermediaries to save for post-retirement consumption. When expecting to live longer, they rely more heavily on intermediaries that use securitization, with riskier but higher returns. A quantitative evaluation of the model shows the potential of the demographic transition to account for a boom in credit and output, but only when it triggers a more extensive use of securitization and shadow banking.

JEL-codes: E21 E44 G21 J11 (search for similar items in EconPapers)
Date: 2019-10
New Economics Papers: this item is included in nep-age, nep-ban, nep-fdg and nep-mac
Note: AG CF EFG ME
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Related works:
Working Paper: Retirement in the Shadow (Banking) (2018)
Working Paper: Retirement in the Shadow (Banking) (2017)
Working Paper: Retirement in the Shadow (Banking) (2015)
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