Retirement-consumption Puzzle: A Theory and Evidence from Leisure Spending
2017/12/22
研討會日期 : 2017-12-22
時間 : 14:30
主講人 : Professor Kyoung Jin Choi
主持人 : Professor Hsuan-Chih Lin
地點 : Conference Room B110
演講者簡介 : Professor Choi received his Ph.D. in Economics from Washington University in St. Louis in 2011. He is currently an Associate Professor of Finance at Haskayne School of Business, University of Calgary. His research interests are Investment, Dynamic Contracting, Portfolio Selection, Real Options, and Asset Pricing.
演講摘要 : There has been a long debate during the last two decades on the retirement-consumption puzzle in economics and finance. The early literature in the late 1990s mostly suggested that the household consumption in many countries significantly drops at retirement, which is against the result from standard life cycle models. However, some researchers in mid 2000s started to argue that there is no puzzle if the home production effect or the time-use after retirement is considered. We revisit the puzzle by using a novel data set from Singapore Life Panel (SLP). We find that the retired not only decrease their spending in food expenditure, but also in their leisure. More importantly, this pattern is mostly driven by the married households and this heterogeneity shows that unlike the food consumption spending, the leisure spending is rarely substituted by time spending or home production. In order to explain the above empirical findings, we develop a household consumption-investment model with voluntary retirement, having multiple goods and services. We characterize the condition of when and which type of consumption jumps after retirement. Our result can explain why there is the consumption drop at retirement and why there is the heterogeneity in the leisure spending between the married and the single households.
