How Do Households Allocate Their Assets? Stylized Facts from the Eurosystem Household Finance and Consumption Survey

52 Pages Posted: 21 Jun 2016

See all articles by Luc Arrondel

Luc Arrondel

Paris School of Economics (PSE)

Laura Bartiloro

Bank of Italy

Pirmin Fessler

Oesterreichische Nationalbank (OeNB)

Peter Lindner

Oesterreichische Nationalbank (OeNB)

Thomas Y. Mathä

Banque centrale du Luxembourg

Cristiana Rampazzi

Bank of Italy

Frederique Savignac

University Paris-Est Créteil (UPEC)

Tobias Schmidt

Deutsche Bundesbank - Research Center

Martin Schuerz

Oesterreichische Nationalbank (OeNB)

Philip Vermeulen

European Central Bank (ECB)

Date Written: 2014

Abstract

Using the Household Finance and Consumption Survey (HFCS), a large micro-level dataset on households' wealth in fifteen euro area countries, this paper explores how households allocate their assets. We derive stylized facts on asset participation as well as levels of asset holdings and investigate the systematic relationships between household characteristics and asset holding patterns. Real assets make up the bulk of total assets. Whereas ownership of the main residence varies strongly between countries, the value of the main residence tends to be the major asset for home-owners and is a significant part of total assets in all countries. While almost all households hold safe financial assets, a low share of households holds risky assets. The ownership rates of all asset categories generally increase with wealth (and income). The significance of inheritances for wealth accumulation is remarkable and underlines its key role in the process of persistent wealth inequality. We tentatively link differences in asset holding patterns across countries to differences in institutions, such as mortgage market institutions and house price-to-rent ratios.

Keywords: household financial decisions, individual portfolio choice, real and financial assets, cross-country comparisons

JEL Classification: D1, D3

Suggested Citation

Arrondel, Luc and Bartiloro, Laura and Fessler, Pirmin and Lindner, Peter and Mathä, Thomas Y. and Rampazzi, Cristiana and Savignac, Frederique and Schmidt, Tobias and Schuerz, Martin and Vermeulen, Philip, How Do Households Allocate Their Assets? Stylized Facts from the Eurosystem Household Finance and Consumption Survey (2014). Bundesbank Discussion Paper No. 12/2014. Available at SSRN: https://ssrn.com/abstract=2796992

Luc Arrondel (Contact Author)

Paris School of Economics (PSE) ( email )

48 Boulevard Jourdan
Paris, 75014 75014
France

Laura Bartiloro

Bank of Italy ( email )

Via Nazionale 91
00184 Roma
Italy

Pirmin Fessler

Oesterreichische Nationalbank (OeNB) ( email )

Otto-Wagner-Platz 3, PO Box 61
Vienna,
1010 Vienna, A-1011
Austria

Peter Lindner

Oesterreichische Nationalbank (OeNB) ( email )

Otto-Wagner-Platz 3, PO Box 61
Vienna,
1010 Vienna, A-1011
Austria

Thomas Y. Mathä

Banque centrale du Luxembourg ( email )

2, bd Royal
L-2983 Luxembourg
Luxembourg
+352 4774 4270 (Phone)
+352 4774 4920 (Fax)

Cristiana Rampazzi

Bank of Italy ( email )

Via Nazionale 91
Rome, 00184
Italy

Frederique Savignac

University Paris-Est Créteil (UPEC) ( email )

61 avenue du General de Gaulle
Creteil cedex, 94010
France

Tobias Schmidt

Deutsche Bundesbank - Research Center ( email )

Wilhelm-Epstein-Str. 14
Frankfurt/Main, 60431
Germany

Martin Schuerz

Oesterreichische Nationalbank (OeNB) ( email )

Otto-Wagner-Platz 3, PO Box 61
Vienna,
1010 Vienna, A-1011
Austria

Philip Vermeulen

European Central Bank (ECB) ( email )

Sonnemannstrasse 22
Frankfurt am Main, 60314
Germany

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