Home > Publications . Search All . Browse All . Country . Browse PSC Pubs . PSC Report Series

PSC In The News

RSS Feed icon

Elliott co-PI on new study examining how early environment impacts children's health

Levy says ACA has helped increase rates of insured, but rates still lowest among poor

Bruch reveals key decision criteria in making first cuts on dating sites

More News

Highlights

U-M ranked #4 in USN&WR's top public universities

Frey's new report explores how the changing US electorate could shape the next 5 presidential elections, 2016 to 2032

U-M's Data Science Initiative offers expanded consulting services via CSCAR

Elizabeth Bruch promoted to Associate Professor

Next Brown Bag

Mon, Oct 3 at noon:
Longevity, Education, & Income, Hoyt Bleakley

Consumption commitments and employment contracts

Archived Abstract of Former PSC Researcher

Postlewaite, A., L. Samuelson, and Daniel Silverman. 2008. "Consumption commitments and employment contracts." Review of Economic Studies, 75(2): 559-578.

We examine an economy in which the cost of consuming some goods can be reduced by making commitments that reduce flexibility. We show that such consumption commitments can induce consumers with risk-neutral underlying utility functions to be risk averse over small variations in income, but sometimes to seek risk over large variations. As a result, optimal employment contracts will smooth wages conditional on being employed, but may incorporate a possibility of unemployment.

DOI:10.1111/j.1467-937X.2008.00472.x (Full Text)

Country of focus: United States of America.

Browse | Search : All Pubs | Next