Stock Market Wealth and Consumption

James Poterba

Journal of Economic Perspectives, 2000, vol. 14, issue 2, 99-118

Abstract: This paper explores the link between changes in the aggregate value of corporate stock and changes in consumer spending. It presents data on the distribution of corporate stock ownership based on the 1998 Survey of Consumer Finances. It also uses time-series evidence on the comovement of stock market wealth and various categories of consumer spending to calibrate "the wealth effect." It concludes that in the year after a change in stock market values, consumer spending is likely to rise by between one and two cents for each dollar increase in the value of corporate stock.

JEL-codes: D31 E21 E44 (search for similar items in EconPapers)
Date: 2000
Note: DOI: 10.1257/jep.14.2.99
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (373)

Downloads: (external link)
http://www.aeaweb.org/articles.php?doi=10.1257/jep.14.2.99 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aea:jecper:v:14:y:2000:i:2:p:99-118

Ordering information: This journal article can be ordered from
https://www.aeaweb.org/journals/subscriptions

Access Statistics for this article

Journal of Economic Perspectives is currently edited by Enrico Moretti

More articles in Journal of Economic Perspectives from American Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Michael P. Albert ().