Research on the Optimal Asset Allocation Decision of Chinese Retirees from the Perspective of Health

Abstract

This paper constructs an optimal asset allocation decision model for retirees based on the characterization of the CRRA utility function and health stock, and uses the Ramsey equation to obtain the optimal intertemporal asset allocation under steady-state conditions. Combining with the actual situation of Chinese retirees, the theoretical model is numerically simulated and analyzed. The results show that different health shock intensities lead to different asset allocation decisions. Based on the research results, this paper puts forward relevant suggestions on how to make optimal asset allocation decisions for retirees and how the government formulates social policies to cope with the aging society.