Household Consumption

Jaime Luque
Additional contact information
Jaime Luque: 1University of Wisconsin-Madison, USA

Chapter 4 in The Subprime Crisis:Lessons for Business Students, 2017, pp 29-37 from World Scientific Publishing Co. Pte. Ltd.

Abstract: Households make consumption decisions by maximizing their level of utility subject to their budget constraint. When negative wealth shocks affect a household’s budget, consumption decisions must be adjusted accordingly. The fall in property values that followed the bursting of the housing bubble is an example of such a shock, and it effectively had an impact on consumers’ behavior. A decrease in consumption sends ripples through the economy, and can exacerbate an already negative economic climate. Understanding how consumption was affected by the subprime crisis is crucial in ascertaining how a crisis in a specific sector affects the economy as a whole…

Keywords: Subprime Crisis; Great Recession; 2009 Recession; Mortgage; Financial Market; Preventing Recession; 2009 Crisis; Interest Rates (search for similar items in EconPapers)
JEL-codes: G01 G1 (search for similar items in EconPapers)
Date: 2017
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.worldscientific.com/doi/pdf/10.1142/9789813200043_0004 (application/pdf)
https://www.worldscientific.com/doi/abs/10.1142/9789813200043_0004 (text/html)
Ebook Access is available upon purchase.

Related works:
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:wsi:wschap:9789813200043_0004

Ordering information: This item can be ordered from

Access Statistics for this chapter

More chapters in World Scientific Book Chapters from World Scientific Publishing Co. Pte. Ltd.
Bibliographic data for series maintained by Tai Tone Lim ().