Consumer sentiment and householde expenditures in Italy: a disaggregated analysis according to the income of the people interviewed

Solange Leproux and Marco Malgarini ()
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Solange Leproux: ISAE - Institute for Studies and Economic Analyses

No 65, ISAE Working Papers from ISTAT - Italian National Institute of Statistics - (Rome, ITALY)

Abstract: The aim of the paper is to evaluate the relationship between consumers’ climate and consumption, looking – respectively – at income-based indicators of confidence and at consumption expenditures disaggregated by durability. We find that confidence significantly contributes explaining consumption behaviour, especially when service expenditures are considered in the analysis: we interpret this result as an evidence that services are discretional, not strictly necessary expenditures, that may be influenced by the willingness to buy, as was originally suggested by Katona (1951) with reference to durable goods. Moreover, confidence calculated for the poorest people in the ISAE sample is found to have a particular strong relationship with consumption, confirming the recent Souleles (2004) hypothesis that it is especially the opinion of some group of individuals to influence consumption patterns.

Keywords: trading confidence climate; consumption theory; heterogeneous behaviour (search for similar items in EconPapers)
JEL-codes: E21 E32 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2006-04
New Economics Papers: this item is included in nep-mac
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Citations: View citations in EconPapers (2)

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