How consumers budget

C. Yiwei Zhang, Abigail B. Sussman, Nathan Wang-Ly and Jennifer K. Lyu

Journal of Economic Behavior & Organization, 2022, vol. 204, issue C, 69-88

Abstract: Although budgeting is widely considered a common method of managing household finances, surprisingly little is known about the budgeting process. Using a nationally-representative survey (N=3,826) of US adults, we examine budgeting behaviors and beliefs, including who budgets and why, how individuals categorize consumption, and how they adjust their behavior after over- or under-spending. We identify five facts that illuminate key features of budgeting and supplement findings with administrative data (N=194,678) from a large financial institution in Australia. Understanding systematic patterns in how individuals and households budget can serve a critical role in informing economic models of consumption-savings behavior.

Keywords: Budgeting; Mental accounting; Consumer finance (search for similar items in EconPapers)
JEL-codes: D14 D91 G50 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:204:y:2022:i:c:p:69-88

DOI: 10.1016/j.jebo.2022.09.025

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