Mortality Shocks and Household Consumption: The Case of Mexico

Marek Sedivy

No 2020/22, Working Papers IES from Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies

Abstract: We study the effect of within-household mortality on the evolution of household per capita consumption. Relying on a panel survey of Mexican households, we find that these households were capable of perfectly smoothing the shock into their consumption caused by the death of a household member. Our findings indicate that a household´s ability to smooth consumption depends neither on the characteristics of the deceased household member nor on the income of a particular household. We find no clear temporal pattern in the evolution of the shock caused by within-household mortality. Our results provide strong support for the hypothesis that the evolution of household consumption is not affected by within-household mortality. Despite being the best available, existing data is still imperfect, and we therefore call for better data in the form of MNCs´ unconsolidated, public country-by-country reporting data.

Keywords: consumption; consumption smoothing; death; mortality (search for similar items in EconPapers)
JEL-codes: D12 D15 I15 O12 (search for similar items in EconPapers)
Pages: 51 pages
Date: 2020-08, Revised 2020-08
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Persistent link: https://EconPapers.repec.org/RePEc:fau:wpaper:wp2020_22

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