Intergenerational Measurement of Effects of Monetary Shocks on Consumption Expenditures of Urban Households in Iran

Seyed Aziz Arman (), Abdul Majeed Ahangari () and Batool Azari Beni ()
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Seyed Aziz Arman: Professor in Economics, Shahid Chamran University of Ahvaz
Abdul Majeed Ahangari: Associate Professor in Economics, Shahid Chamran University of Ahvaz
Batool Azari Beni: Ph.D. Candidate in Economics, Shahid Chamran University of Ahvaz

Quarterly Journal of Applied Theories of Economics, 2023, vol. 10, issue 4, 205-234

Abstract: This article presents a case study to assess the impact of monetary market shocks on the consumption behavior of urban households across different age groups (elderly, middle-aged, and young cohorts). Utilizing a method developed by Deaton and Paxson (1997) and analyzing cross-sectional household budget data, a pseudo-panel dataset is constructed to examine the intergenerational consumption patterns of individuals born between 1957 and 1992. The findings highlight that the highest magnitude of monetary market shock occurred from 2011 to 2012. It is observed that young households exhibit lower consumption levels compared to other cohorts and experience greater vulnerability to both small and significant adverse shocks in the monetary market. Furthermore, a significant negative shock impacts all age groups, resulting in a convergence of consumption expenditures across cohorts; however, the young cohort experiences the most significant reduction in consumption due to its heightened vulnerability relative to other age groups

Keywords: Monetary Shocks; Consumption Expenditures; cohort study; pseudo panel data (search for similar items in EconPapers)
JEL-codes: E32 I32 (search for similar items in EconPapers)
Date: 2023
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