Are economic agents (consumers) truly “foresighted” in their decision making?
When consumers make inter-temporal consumption decisions they “who decide how much to consume based on the value of their total wealth, which comprises: The value of their nonhuman wealth, or the sum of financial wealth and housing wealth. The value of his human wealth or the present value of expected after-tax labour income”, Blanchard et al, p332, 2010.

Explain and evaluate the reasoning in the two articles provided (A.Blinder: Intergenerational Transfers and Life Cycle Consumption, and Danzinger etal The life-cycle hypothesis and the consumption behaviour of the elderly), in your readings booklet ( also on the module Blackboard site), to discuss the question above.

Format
1. This is an individual essay with a word limit of 1500 words.

2. Submit your essay to the SAC no later than 25th of February 2013, (by 4.00pm at the latest).

3. The assessed work will be returned to you within 5 weeks. Your grade will be subject to ratification by the External Examiner and the Examination Board.

4. You are reminded of the University’s rules on plagiarism which are rigorously enforced. Please consult the student regulations and/or your programme leader for further details.

5. Ensure you submit the assignment electronically, through the turn it in process, via the Blackboard site.

 
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