 How important are wealth effects on consumption in Canada?Maral Kichian and Milana Mihic Canadian Journal of Economics, 2018, vol. 51, issue 3, 784-798 Abstract: We estimate the marginal propensity to consume from financial and housing wealth in Canada. The modelling framework of Carroll et al. (2011) that builds on the observed stickiness in consumption data is used. Estimations and inferences are conducted using identification-robust methods. The results provide support for the overall modelling strategy, but there are also important differences in the identification status of the econometric equations considered. Based on the most informative specification, we find that both types of wealthfinancial and housinghave significant effects in Canada and that the former has a greater effect than the latter. A simple extension of the model that also accounts for non-price credit conditions shows that housing wealth may be relevant only during periods of easier access to credit. Finally, we find support for relatively high stickiness in consumption growth in Canada. JEL-codes: C13 (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:cje:issued:v:51:y:2018:i:3:p:784-798 Ordering information: This journal article can be ordered from Access Statistics for this article Canadian Journal of Economics is currently edited by Zhiqi Chen More articles in Canadian Journal of Economics from Canadian Economics Association Canadian Economics Association Prof. Werrner Antweiler, Treasurer UBC Sauder School of Business 2053 Main Mall Vancouver, BC, V6T 1Z2. Contact information at EDIRC. |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.