Household Inflation Expectations and Consumer Spending
Evidence from Panel Data
Bibliographic Data
| ID | 19313830 |
|---|---|
| Authors | Mary A Burke (Federal Reserve Bank of Boston), Ali Ozdagli (Federal Reserve Bank of Dallas), Ali K Ozdagli (0000-0001-7165-689X, Federal Reserve Bank of Dallas) |
| Year | 2023 |
| Volume | 105 |
| Issue | 4 |
| Pages | 948-961 |
| Publication date | 2023-07-11 |
| Open Access | No |
| Type | ARTICLE |
| Venue | The Review of Economics and Statistics (JOURNAL) |
| Journal identifiers | ISSN: 0034-6535 • E-ISSN: 1530-9142 |
| Publisher | MIT Press (PUBLISHER • US) |
| DOI | 10.1162/rest_a_01118 |
| OpenAlex | W4230538966 |
| Language | EN |
| Citations received | 6 |
| References cited | 29 |
Recent research offers mixed results concerning the relationship between inflation expectations and consumption, using qualitative measures of readiness to spend. We revisit this question using survey panel data of actual spending from the United States between 2009 and 2012 that also allows us to control for household heterogeneity. We find that durables spending increases with expected inflation only for selected types of households while nondurables spending does not respond to expected inflation. Moreover, spending decreases with expected unemployment. These results imply a limited stimulating effect of inflation expectations on aggregate consumption, which could be reversed if inflation and unemployment expectations move together
Consumer spending · Consumption (sociology) · Econometrics · Economics · Inflation (cosmology) · Macroeconomics · Monetary economics · Panel data · Recession · Unemployment · Economic theories and models · Financial Literacy, Pension, Retirement Analysis · Monetary Policy and Economic Impact
Direct Elicitation of Parametric Belief Distributions
The common macroeconomic drivers of income inequality and household final consumption
Survival spending
Investigating how inflation expectations affect precautionary wealth
Deflation and Economic Crisis
Are Consumers' Spending Decisions in Line with A Euler Equation
The Debt-Deflation Theory of Great Depressions
Models for Longitudinal Data
Correlated random effects models with unbalanced panels
On the Pooling of Time Series and Cross Section Data
The anchoring of inflation expectations in Japan
Are Consumers' Spending Decisions in Line with A Euler Equation
Nominal Rigidities and the Dynamic Effects of a Shock to Monetary Policy
Inside the Black Box
| Citations per year | 0.67 |
|---|---|
| Citation span | 2017 - 2026 (10) |
| Highly cited | No |