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Modeling life-cycle earnings risk with positive and negative shocks

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dc.affiliation.dptoUC3M. Departamento de Economíaes
dc.contributor.authorSánchez, Manuel
dc.contributor.authorWellschmied, Félix
dc.contributor.funderMinisterio de Economía y Competitividad (España)es
dc.contributor.funderComunidad de Madrides
dc.date.accessioned2022-03-29T16:23:10Z
dc.date.available2022-07-01T23:00:06Z
dc.date.issued2020-07-01
dc.description.abstractWe estimate explicit age-varying distributions of idiosyncratic persistent and transitory earnings shocks over workers' life-cycles using a German administrative data set. Large positive shocks, both transitory and persistent, are characteristic for the first eight years of the working life. After the age of 50, large negative shocks become a major source of earnings risk. Between the ages of 30 and 50, most shocks are small and transitory. Large persistent positive shocks that occur early in the working life help to rationalize large wealth and consumption shares of the top one percent in an incomplete markets model.es
dc.description.sponsorshipThis paper uses the Sample of Integrated Labour Market Biographies-Regional File 1975-2010, SIAB R 7510. The data was provided via the Cornell Restricted Access Data Center, previous authorization of the Research Data Center of the German Federal Employment Agency at the Institute for Employment Research, under the project 'Labour Income Profiles are not heterogeneous: a European test'. Felix Wellschmied gratefully acknowledges support from the Spanish Ministry of Economics through research grants ECO2014-56384-P, MDM 2014-0431, and Comunidad de Madrid MadEco-CM (S2015/HUM-3444).en
dc.identifier.bibliographicCitationSanchez, M., & Wellschmied, F. (2020). Modeling life-cycle earnings risk with positive and negative shocks. Review of Economic Dynamics, 37, pp. 103-126.es
dc.identifier.doihttps://doi.org/10.1016/j.red.2019.11.003
dc.identifier.issn1094-2025
dc.identifier.publicationfirstpage103es
dc.identifier.publicationlastpage126es
dc.identifier.publicationtitleREVIEW OF ECONOMIC DYNAMICSes
dc.identifier.publicationvolume37es
dc.identifier.urihttps://hdl.handle.net/10016/34490
dc.identifier.uxxiAR/0000026582
dc.language.isoenges
dc.publisherElsevieres
dc.relation.projectIDGobierno de España. ECO2014-56384-Pes
dc.relation.projectIDGobierno de España. MDM-2014-0431es
dc.relation.projectIDComunidad de Madrid. S2015/HUM-3444
dc.rights©2020 Elsevieres
dc.rightsAtribución-NoComercial-SinDerivadas 3.0 España*
dc.rights.accessRightsopen accesses
dc.rights.urihttp://creativecommons.org/licenses/by-nc-nd/3.0/es/*
dc.subject.otherLife-cycleen
dc.subject.otherEarnings risken
dc.subject.otherWealth dispersionen
dc.subject.otherConsumption inequalityen
dc.titleModeling life-cycle earnings risk with positive and negative shocksen
dc.typeresearch article*
dc.type.hasVersionAM*
dspace.entity.typePublication
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