Wealth Effects on Consumption Plans: French Households in the Crisis

Luc Arrondel, Frédérique Savignac and K. Tracol

Working papers from Banque de France

Abstract: This paper analyzes the wealth effect on consumption in France by relying on two original household surveys. First, it provides the first estimate of the marginal propensity to consume out of wealth based on micro data for France (Enqu te Patrimoine 2009, Insee): a low but significant wealth effect is obtained and financial wealth seems to be significant only for stockholders. Second, it studies how French households have adapted their consumption plans during the 2008-2009 crisis by relying on household self-assessed changes in future consumption (survey PATER). Besides the direct wealth effect, our results confirm the role played by changes in expectations on consumption plans, and thus, by the confidence channel as an additional transmission mechanism of the crisis.

Keywords: wealth effect; housing and financial wealth; consumption; household survey; expectations. (search for similar items in EconPapers)
JEL-codes: C25 D12 E21 E44 (search for similar items in EconPapers)
Pages: 58 pages
Date: 2011
New Economics Papers: this item is included in nep-eec
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Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:bfr:banfra:344

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