Wealth Accumulation: The Role of Others

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The Wharton School::Wharton Pension Research Council::Wharton Pension Research Council Working Papers
Degree type
Discipline
Economics
Subject
wealth accumulation
peer effects
retirement saving
wealth inequality
cognitive load
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Copyright date
2024
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Author
Haliassos, Michael
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Abstract

This chapter reviews evidence from several recent projects exploring how neighbors, peers, financial advisors, and exogenous stressors affect wealth accumulation. Having neighbors with college economics or business education promotes retirement saving. Greater local wealth inequality and mobility at the start of economic life motivate college graduates to take portfolio risks and achieve greater wealth, leaving others behind. Financial advice from unbiased professionals differs from peer advice in how it relates to advisor and advisee characteristics. Background stressors, such as crises, wars, and personal problems, occupy savers’ minds. In an incentivized online experiment, background cognitive load consistently dampened consumption and promoted saving.

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WP2024-18
Publication date
2024-10-03
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Comments
All findings, interpretations, and conclusions of this paper represent the views of the authors and does not represent official views of the above-named institutions. © 2024 Pension Research Council of the Wharton School of the University of Pennsylvania. All rights reserved.
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