The growing link between the federal government and state and local government financing

Finance, Public ; Local finance ; Revenue sharing

Are you protected from inflation?

Inflation (Finance)

Coordinated international economic expansion: are convoys or locomotives the answer?

International economic integration

Invest As I Say, Not As I Do? Gender Dif-ferences In Financial Risk Preferences

This paper examines gender differences in stated versus observed financial risk preferences.  The responses of women versus men to a question regarding financial risk preferences are compared to the proportion of risky assets held in their portfolios using data from the 1995 Survey of Consumer Finances. The data show that women are more likely to express an unwillingness to take financial risks.  Stated financial risk preferences are found to be consistent with observed risk preferences at the ordinal, but not the quantitative, level.  Contradicting their stated risk preferences, risky assets constitute, on average, one-third of the financial assets of households that indicate they are unwilling to take any financial risks. Financial planners and advisers frequently use a client’s expressed willingness to take on risk as an important determinant in asset allocation recommendations. Consistent gender differences in these responses, in addition to inconsistencies between the client’s stated risk preferences and observed portfolio allocation, may lead advisers to make inappropriate recommendations

Wealth Mobility

This paper examines the wealth mobility of a panel of mature American men between 1966 and 1981. Although greater persistence exists than within the income distribution, a sizeable degree of movement within the wealth distribution is observed. Slightly more than half of the households changed quintiles. However, the magnitude of the movement was modest, with 78% of the moves to an adjacent quintile. Movements into either extreme of the wealth distribution were relatively rare. Really big moves, from the poorest to richest group, were extremely rare, with the probability of a black making such a move within fifteen years approximately zero. © 2001 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology