 Heterogeneous consumers in the Euro-Area, facing homogeneous monetary policy: Tale of two large economiesSarfaraz Ali Shah Syed The Journal of Economic Asymmetries, 2021, vol. 24, issue C Abstract: This study examines consumer behavior in the Euro-Area in response to monetary policy changes. Selecting two major Euro-Area economies, we apply factor model to investigate how German and French consumers update their macroeconomic expectations. Results at both aggregate and disaggregated levels show asymmetries in consumer responses to different monetary policy stances. We find sizable differences in the way German consumers adjust their expectations compared to the French consumers. While we record inconsistencies across different consumer expectations, we also find behavioral differences in the consumer from similar groups across both countries. The paper concludes that though consumers update their expectations immediately to a monetary policy change, French consumers show a relative discomfort and lesser confidence in the post-recession period despite accommodative moves by the European Central Bank (ECB). Keywords: Euro-Area; Asymmetric inconsistencies; Consumer expectations; Monetary Policy Changes (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:joecas:v:24:y:2021:i:c:s1703494921000190 DOI: 10.1016/j.jeca.2021.e00214 Access Statistics for this article The Journal of Economic Asymmetries is currently edited by A.G. Malliaris More articles in The Journal of Economic Asymmetries from Elsevier |
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