Poor and wealthy hand-to-mouth households in Belgium

Laurens Cherchye, Thomas Demuynck, Bram Rock (), Mariia Kovaleva, Geoffrey Minne, Maite De Sola Perea and Frederic Vermeulen
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Bram Rock: Université Libre de Bruxelles and Department of Economics, University of Leuven (KU Leuven)
Mariia Kovaleva: Université libre de Bruxelles. Avenue F. D. Roosevelt 50
Maite De Sola Perea: National Bank of Belgium

Review of Economics of the Household, 2024, vol. 22, issue 3, No 2, 909-934

Abstract: Abstract We identify the population shares of poor hand-to-mouth households, wealthy hand-to-mouth households and non hand-to-mouth households in Belgium. We apply the methodology proposed by Kaplan & Violante (2014) and Kaplan et al., (2014) to the Belgian component of the Household Finance and Consumption Survey. We find that the fraction of hand-to-mouth households in Belgium is substantial and predominantly consists of wealthy hand-to-mouth households. We also compare the observable characteristics and marginal propensities to consume (MPCs) of the three household types. Belgian wealthy hand-to-mouth households have characteristics that resemble those of the non hand-to-mouth households, while their MPCs are often more similar to those of the poor hand-to-mouth households. This pleads for giving a unique place to each type of household when evaluating the effects of fiscal policy.

Keywords: savings; hand-to-mouth households; liquidity; marginal propensity to consume (MPC) (search for similar items in EconPapers)
JEL-codes: D12 D15 E2 (search for similar items in EconPapers)
Date: 2024
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Related works:
Working Paper: Poor and Wealthy Hand-to-mouth Households in Belgium (2023)
Working Paper: Poor and wealthy hand-to-mouth households in Belgium (2023)
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DOI: 10.1007/s11150-023-09689-z

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