By Sanvi Avouyi-Dovi, Affiliate Professor, ICN Business School, Christian Pfister, Associate Researcher, Laboratoire d'Economie d'Orléans (LÉO, Université d'Orléans) and Franck Sedillot, Director, Balance of Payments, Direction Générale des Statistiques, des Études et de l'International, Banque de France.

In a recent article published in the Revue économique, we investigate the factors explaining changes in the composition of French households' financial wealth over the last three decades, by estimating an extended version of the Deaton and Muellbauer (1980) model applied to the portfolio choices of French households. We find that most of the estimated parameters of the benchmark model are consistent with theory. In particular, wealth and real returns are the key determinants of the shares of different assets in the portfolio. This post summarizes the main findings of our article.

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