Social Science Research Network
Precautionary saving, Prudence, Selden/Kreps-Porteus Preferences
This paper re-examines precautionary saving with general Selden/Kreps-Porteus preferences. The conditions existing in the literature are much more complex than in the Expected Utility framework. We obtain a simple and intuitive result on precautionary savings via disentangling time preference and risk preference effects.
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Li, J., & Wang, J. (2014). Precautionary saving with Selden/Kreps-Porteus preferences revisited. Social Science Research Network. Retrieved from http://dx.doi.org/10.2139/ssrn.2458316