The Volatility Trap : Precautionary Saving, Investment, and Aggregate Risk /

We study the effects of permanent and temporary income shocks on precautionary saving and investment in a "store-or-sow" model of growth. High volatility of permanent shocks results in high precautionary saving in the safe asset and low investment, or a "volatility trap." Namely,...

Descrizione completa

Dettagli Bibliografici
Autore principale: Cherif, Reda
Altri autori: Hasanov, Fuad
Natura: Periodico
Lingua:English
Pubblicazione: Washington, D.C. : International Monetary Fund, 2012.
Serie:IMF Working Papers; Working Paper ; No. 2012/134
Accesso online:Full text available on IMF
LEADER 01762cas a2200253 a 4500
001 AALejournalIMF011882
008 230101c9999 xx r poo 0 0eng d
020 |c 5.00 USD 
020 |z 9781475503869 
022 |a 1018-5941 
040 |a BD-DhAAL  |c BD-DhAAL 
100 1 |a Cherif, Reda. 
245 1 4 |a The Volatility Trap :   |b Precautionary Saving, Investment, and Aggregate Risk /  |c Reda Cherif, Fuad Hasanov. 
264 1 |a Washington, D.C. :  |b International Monetary Fund,  |c 2012. 
300 |a 1 online resource (21 pages) 
490 1 |a IMF Working Papers 
500 |a <strong>Off-Campus Access:</strong> No User ID or Password Required 
500 |a <strong>On-Campus Access:</strong> No User ID or Password Required 
506 |a Electronic access restricted to authorized BRAC University faculty, staff and students 
520 3 |a We study the effects of permanent and temporary income shocks on precautionary saving and investment in a "store-or-sow" model of growth. High volatility of permanent shocks results in high precautionary saving in the safe asset and low investment, or a "volatility trap." Namely, big savers invest relatively little. In contrast, low volatility of permanent shocks leads to low precautionary saving and high or low investment, depending on the volatility of temporary shocks. Empirical evidence shows a nonlinear relationship between investment and saving and that investment is a hump-shaped function of the volatility of permanent shocks, as predicted by the model. 
538 |a Mode of access: Internet 
700 1 |a Hasanov, Fuad. 
830 0 |a IMF Working Papers; Working Paper ;  |v No. 2012/134 
856 4 0 |z Full text available on IMF  |u http://elibrary.imf.org/view/journals/001/2012/134/001.2012.issue-134-en.xml  |z IMF e-Library