EconPapers    
Economics at your fingertips  
 

Modeling the Consumption Response to the CARES Act

Christopher Carroll, Edmund Crawley, Jiri Slacalek and Matthew White ()
Additional contact information
Edmund Crawley: Federal Reserve Board

International Journal of Central Banking, 2021, vol. 17, issue 1, 107-141

Abstract: To predict the effects of the 2020 U.S. CARES Act on consumption, we extend a model that matches responses to past consumption stimulus packages. The extension allows us to account for two novel features of the coronavirus crisis. First, during lockdowns, many types of spending are undesirable or impossible. Second, some of the jobs that disappear during the lockdown will not reappear. We estimate that, if the lockdown is short-lived (the median point of view as we are writing in April 2020), the combination of expanded unemployment insurance benefits and stimulus payments should be sufficient to allow a swift recovery in consumer spending to pre-crisis levels. If the lockdown lasts longer (or there is a "second wave"), an extension of enhanced unemployment benefits will likely be necessary for consumption spending to recover quickly.

JEL-codes: D83 D84 E21 E32 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://www.ijcb.org/journal/ijcb21q1a4.pdf (application/pdf)
http://www.ijcb.org/journal/ijcb21q1a4.htm (text/html)

Related works:
Working Paper: Modeling the consumption response to the CARES Act (2020) Downloads
Working Paper: Modeling the Consumption Response to the CARES Act (2020) Downloads
Working Paper: Modeling the Consumption Response to the CARES Act (2020) Downloads
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:ijc:ijcjou:y:2021:q:1:a:4

Access Statistics for this article

International Journal of Central Banking is currently edited by Loretta J. Mester

More articles in International Journal of Central Banking from International Journal of Central Banking
Bibliographic data for series maintained by Bank for International Settlements ().

 
Page updated 2025-03-22
Handle: RePEc:ijc:ijcjou:y:2021:q:1:a:4