Saving and portfolio allocation before and after job loss

Christoph Basten, Andreas Fagereng and Kjetil Telle

Discussion Papers from Statistics Norway, Research Department

Abstract: Using administrative panel data from Norway, we investigate the development of household labor income, financial wealth and asset holdings over a nine-year period surrounding job loss. Consistent with a simple theoretical model, the data show precautionary saving and a shift toward safer assets in the years leading up to unemployment, and depletion of savings during unemployment. This suggests that at least some households can foresee and prepare for upcoming unemployment, which indicates that private savings can complement publicly provided unemployment insurance.

Keywords: unemployment; precautionary saving; consumption smoothing; household portfolios; portfolio allocation; optimal unemployment insurance (search for similar items in EconPapers)
JEL-codes: D12 E21 E24 G11 J65 (search for similar items in EconPapers)
Date: 2012-01
New Economics Papers: this item is included in nep-ias and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Related works:
Journal Article: Saving and Portfolio Allocation Before and After Job Loss (2016)
Working Paper: Saving and portfolio allocation before and after job loss (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:ssb:dispap:672

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