Essays on consumption behaviour related to health and retirement

This dissertation is concerned with the empirical study of households' decisions on consumption and time use over the life-cycle. The first chapter presents evidence on the role of shocks around the time of retirement as a potential explanation of the retirement-consumption puzzle. We address this issue by studying how expenditure of households in different quartiles of the pre-retirement wealth distribution behaves around the time of retirement and how this is related to health shocks.

In the next chapter we focus on consumption over the life-cycle and show how different consumption patterns between workers and pensioners translates into different inflation experiences. We first document the expenditure life-cycle profile in the UK and show how differences in the consumption bundle of pensioners and workers translates into different inflation experiences. In the second part of the chapter we estimate cost of living indexes for pensioners and workers in order to better understand pension income requirements. We estimate a demand system and compute the change in the cost of living and the substitution effect for both pensioners and workers for the period 1990-2009.

The last chapter focuses on household decisions related to food consumption and the use of time. Using a combination of food diary data and information on its nutritional content, we compile a unique time series of microdata on calorie and food purchases in England spanning over more than 30 years. We measure calories from food at home purchases over the whole time series, but using a combination of observed and imputed data, are also able to fill the gap of knowledge about calories from other foods and drinks: eating out and alcohol. In addition to this, we also show data on bodyweight, calorie purchases and calories expended in different activities.