NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Precautionary Motives for Holding Assets

Miles S. Kimball

NBER Working Paper No. 3586
Issued in January 1991
NBER Program(s):   ME

At least three types of precautionary motives are directly relevant to an agent's demand for assets. (I.) The precautionary saving motive, or prudence, can cause an agent to respond to a risk by accumulating more wealth. (II.) The desire to moderate total exposure to risk, or temperance, can cause an agent to respond to an unavoidable risk by reducing exposure to other risks even when the other risks are statistically independent of the first. (III.) The precautionary demand for liquidity can cause an agent to respond to a risk by holding more money.

download in pdf format
   (184 K)

download in djvu format
   (116 K)

email paper

This paper is available as PDF (184 K) or DjVu (116 K) (Download viewer) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w3586

Published: New Palgrave Dictionary of Money and Finance, (London: MacMillan Press: 199 2) and (New York: Stockton Publishers: 1992);, Volume 3, pp. 158-161

 
Publications
Activities
Meetings
NBER Videos
Themes
Data
People
About

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us