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Equities and inequality

Alessandra Bonfiglioli ()

Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra

Abstract: Most US credit card holders revolve high-interest debt, often combined with substantial (i) asset accumulation by retirement, and (ii) low-rate liquid assets. Hyperbolic discounting can resolve only the former puzzle (Laibson et al., 2003). Bertaut and Haliassos (2002) proposed an 'accountant-shopper'framework for the latter. The current paper builds, solves, and simulates a fully-specified accountant-shopper model, to show that this framework can actually generate both types of co-existence, as well as target credit card utilization rates consistent with Gross and Souleles (2002). The benchmark model is compared to setups without self-control problems, with alternative mechanisms, and with impatient but fully rational shoppers.

Keywords: Income inequality; financial development; capital market frictions; investor protection; instrumental variables; dynamic panel data (search for similar items in EconPapers)
JEL-codes: D31 E44 G30 O15 O16 (search for similar items in EconPapers)
Date: 2005-09
New Economics Papers: this item is included in nep-dev, nep-fin, nep-fmk and nep-mac
References: View references in EconPapers View complete reference list from CitEc
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Working Paper: Equities and Inequality (2005) Downloads
Working Paper: Equities and Inequality (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:upf:upfgen:947

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