The effects of pension-related policies on household spending

Susana Parraga Rodriguez

No 1913, Working Papers from Banco de España

Abstract: This paper estimates the impact of pension-related policies on household spending. The identification strategy exploits the deviation in pensioner income and expenditure caused by the introduction of a new pension system during the 1980s and 1990s in Spain and constructs a new narrative series of legislated pension changes. I present a variety of estimates, some of them imply that increases in the average pension have a roughly one-for-one effect on pensioner spending. The strongest effects are on the pensioners with the highest levels of expenditure, income, and wealth. Estimates for different categories of expenditure indicate that benefit increases trigger these pensioners to spend more on durables. At the same time, pension-related policies targeted to pensioners with low income levels seem to affect the spending on non-durables and necessities such as food positively.

Keywords: fiscal policy; narrative public pensions changes; household expenditure (search for similar items in EconPapers)
JEL-codes: D12 H31 H55 N14 (search for similar items in EconPapers)
Pages: 63 pages
Date: 2019-05
New Economics Papers: this item is included in nep-age and nep-his
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Persistent link: https://EconPapers.repec.org/RePEc:bde:wpaper:1913

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