The impact of human capital on life-cycle portfolio choice: Evidence for the Netherlands

We study the impact of human capital on life-cycle portfolio choice using Dutch data. A distinction is made between the riskless view of human capital as having bond-like characteristics, and therisky conception of future wage income having stock-like properties. As in Benzoni, Collin-Dufresne, and Goldstein (2007) we study the welfare implications of portfolio choice when wage income and dividends are co-integrated. Based on Dutch data our analysis confirms the US results as the preferred equity allocationalso shows a hump-shaped pattern.