| 1. |
- Briggs, Joseph S., et al.
(författare)
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Windfall gains and stock market participation
- 2015
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Rapport (övrigt vetenskapligt/konstnärligt)abstract
- We estimate the causal effect of wealth on stock market participation using administrative data on Swedish lottery players. A $150,000 windfall gain increases stock ownership probability among pre-lottery non-participants by 12 percentage points, while pre-lottery stock holders are unaffected. The effect is immediate, seemingly permanent and heterogeneous in intuitive ways. Standard lifecycle models predict wealth effects far too large to match our causal estimates under common calibrations. Additional analyses suggest a limited role for explanations such as procrastination or real-estate investment. Overall, results suggest that “nonstandard” beliefs or preferences contribute to the nonparticipation of households across many demographic groups.
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| 2. |
- Cesarini, David, et al.
(författare)
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The effect of wealth on household labor supply : evidence from Swedish lotteries
- 2015
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Rapport (övrigt vetenskapligt/konstnärligt)abstract
- We study the effect of wealth on labor supply using the randomized assignment of monetary prizes in a large sample of Swedish lottery players. We find winning a lottery prize modestly reduces labor earnings, with the reduction being immediate, persistent, and similar by age, education, and sex. A calibrated dynamic model of individual labor supply implies an average lifetime marginal propensity to earn out of unearned income of -0.11, and labor-supply elasticities in the lower range of previously reported estimates. The earnings response is stronger for winners than their spouses, which is inconsistent with unitary household labor supply models.
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| 3. |
- Cesarini, David, et al.
(författare)
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Wealth, Health, and Child Development : Evidence from Administrative Data on Swedish Lottery Players
- 2015
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Rapport (övrigt vetenskapligt/konstnärligt)abstract
- We use administrative data on Swedish lottery players to estimate the causal impact of substantial wealth shocks on players' own health and their children's health and developmental outcomes. Our estimation sample is large, virtually free of attrition, and allows us to control for the factors conditional on which the prizes were randomly assigned. In adults, we find no evidence that wealth impacts mortality or health care utilization, with the possible exception of a small reduction in the consumption of mental health drugs. Our estimates allow us to rule out effects on 10-year mortality one sixth as large as the cross-sectional wealth-mortality gradient. In our intergenerational analyses, we find that wealth increases children's health care utilization in the years following the lottery and may also reduce obesity risk. The effects on most other child outcomes, which include drug consumption, scholastic performance, and skills, can usually be bounded to a tight interval around zero. Overall, our findings suggest that in affluent countries with extensive social safety nets, causal effects of wealth are not a major source of the wealth-mortality gradients, nor of the observed relationships between child-developmental outcomes and household income.
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| 4. |
- Lindqvist, Erik, et al.
(författare)
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Does Wealth Inhibit Criminal Behavior? Evidence From Swedish Lottery Winners and Their Children
- 2023
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Ingår i: NBER Working Paper Series. - Stockholm, Sweden : Swedish Institute for Social Research (SOFI). - 0898-2937.
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Rapport (övrigt vetenskapligt/konstnärligt)abstract
- There is a well-established negative gradient between economic status and crime, but its underlying causal mechanisms are not well understood. We use data on four Swedish lotteries matched to data on criminal convictions to gauge the causal effect of financial windfalls on player`s own crime and their children`s delinquency. We estimate a positive but statistically insignificant effect of lottery wealth on players`own conviction risk. Our estimates allows us to rule out effects one fifth as large as the cross-sectional gradient between income and crime. We also estimate a less precise null effect of parental lottery wealth on child delinquency.
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| 5. |
- Lindqvist, Erik, et al.
(författare)
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Financial Windfalls, Portfolio Allocations, and Risk Preferences
- 2023
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Rapport (övrigt vetenskapligt/konstnärligt)abstract
- We investigate the impact of financial windfalls on household portfolio choices and risk exposure. Exploiting the randomized assignment of lottery prizes in three Swedish lotteries, we find a windfall gain of $100K leads to a 5-percentage-point de- crease in the risky share of household portfolios. We show theoretically that negative wealth effects are consistent with both constant and decreasing relative risk aversion and analyze how our empirical estimates help distinguish between competing models of portfolio choice. We further show our results are quantitatively aligned with the predictions of a calibrated dynamic portfolio choice model with nontradable human capital and consumption habits.
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| 6. |
- Lindqvist, Erik, et al.
(författare)
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Fortunate Families? The Effects of Wealth on Marriage and Fertility.
- 2023
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Ingår i: NBER Working Paper Series. - Cambridge : National Bureau of Economic Research, Inc. - 0898-2937.
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Rapport (övrigt vetenskapligt/konstnärligt)abstract
- We estimate the effects of large, positive wealth shocks on marriage and fertility in a sample of Swedish lottery players. For male winners, wealth increases marriage formation and reduces divorce risk, suggesting wealth increases men’s attractiveness as prospective and current partners. Wealth also increases male fertility. The only discernible effect on female winners is that wealth increases their short-run (but not long-run) divorce risk. Our results for divorce are consistent with a model where the wealthier spouse retains most of his/her wealth in divorce. In support of this assumption, we show divorce settlements in Sweden often favor the richer spouse. JEL Codes: D1, J12, J13.
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