Journal
JOURNAL OF ECONOMIC SURVEYS
Volume 30, Issue 1, Pages 34-55Publisher
WILEY
DOI: 10.1111/joes.12090
Keywords
Borrowing constraints; Consumption; Deleveraging; Financial wealth; Household debt; Housing wealth; Saving; Wealth effects
Categories
Ask authors/readers for more resources
The effect of wealth on consumption is an issue of long-standing interest to economists. Conventional wisdom suggests that fluctuations in household wealth have driven major swings in economic activity both in the United States and abroad. This paper considers the so-called consumption wealth effects. There is an extensive existing literature on wealth effects that has yielded some insights. For example, research has documented the relationship between aggregate household wealth and aggregate consumption over time, and a large number of household-level studies suggest that wealth effects are larger for households facing credit constraints. However, there are also many unresolved issues regarding the influence of household wealth on consumption. We review the most important of these issues and argue that there is a need for much more research in these areas as well as better data sources for conducting such analysis.
Authors
I am an author on this paper
Click your name to claim this paper and add it to your profile.
Reviews
Recommended
No Data Available