Asset Management, Allocation of Time, and Returns to Saving

Economic Inquiry, Vol. 14, No. 4, pp. 558-586, December 1976 (Oxford University Press)

29 Pages Posted: 8 Oct 2009

See all articles by Isaac Ehrlich

Isaac Ehrlich

State University of New York at Buffalo - Department of Economics; National Bureau of Economic Research (NBER); University of Chicago - University of Chicago Press; Institute for the Study of Labor (IZA)

Uri Ben-Zion

Technion-Israel Institute of Technology

Date Written: December 1, 1976

Abstract

The paper entertains the proposition that individuals' time performs a productive role in generating nonwage income through the management of nonhuman capital assets. The asset management hypothesis is used to develop a life cycle model of consumptive and productive decisions. The model allows for variations in gross rates of return both across persons at a point in time and for any one person over his life cycle. The behavioral implications developed show that differences across consumption units in their time allocations and in their borrowing, saving, and asset holding decisions may be the result of differences in opportunities rather than "tastes."

Suggested Citation

Ehrlich, Isaac and Ben-Zion, Uri, Asset Management, Allocation of Time, and Returns to Saving (December 1, 1976). Economic Inquiry, Vol. 14, No. 4, pp. 558-586, December 1976 (Oxford University Press), Available at SSRN: https://ssrn.com/abstract=1302899

Isaac Ehrlich (Contact Author)

State University of New York at Buffalo - Department of Economics ( email )

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Uri Ben-Zion

Technion-Israel Institute of Technology ( email )

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Israel

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