Heterogeneous Time Preferences and Interest Rates - The Preferred Habitat Theory Revisited
نویسنده
چکیده
The influence of heterogeneous time preferences on the term structure is investigated. Motivated by the Preferred Habitat Theory of Modigliani and Sutch, a model for intertemporal preferences accounting for preferred habitats is proposed. In a heterogeneous world, preferred habitats can explain humps in the yield curve. Agents with a long habitat prefer long term bonds to shorter instruments as the Preferred Habitat Theory predicts.
منابع مشابه
Price Pressure in the Government Bond Market
What determines the term structure of interest rates? Standard economic theory links the interest rate for maturity T to the willingness of a representative agent to substitute consumption between times 0 and T. The standard model contrasts sharply with a more informal view based on investors’ preferred habitat, proposed by John Culbertson (1957) and Franco Modigliani and Richard Sutch (1966). ...
متن کاملAssessments of habitat preferences and quality depend on spatial scale and metrics of fitness
1. Identifying the habitat features that influence habitat selection and enhance fitness is critical for effective management. Ecological theory predicts that habitat choices should be adaptive, such that fitness is enhanced in preferred habitats. However, studies often report mismatches between habitat preferences and fitness consequences across a wide variety of taxa based on a single spatial...
متن کاملParental Preferences over Children's Sex:The Case Study of Iran
The question of whether parents have preferences over their children’s sexes has long been of interest to economists and demographers. In this study, we first investigate the presence of these preferences among Iranian parents. Then, having established its existence, we next turn to characterize the quality of sex preference. There are two widely used methods for addressing this issue in the l...
متن کاملبررسی و تبیین مشکل ناسازگاری زمانی
In very, simple words, time inconsistency means failing to conduct programs in consistence with time. In other words, time inconsistency refers to a situation where economic decision-makers preferences transform a long time in a way that what they preferred at a certain time point is not consistent with their preferences at other time points. In everyday life, we always face time inconsistency....
متن کاملProduction subsidies and redistribution
Who gains from stimulating output? We explore a dynamic model with production subsidies where the population is heterogeneous in one dimension: wealth. There are two channels through which production subsidies redistribute resources across the population. First, poorer agents gain from a rise in wages, since—to the extent there is an operative wealth effect in labor supply—they work harder. Sec...
متن کامل