Wealth effects and the consumption of Italian households in the Great Recession
Serena Trucchi and
No W13/21, IFS Working Papers from Institute for Fiscal Studies
We estimate marginal propensities to consume from wealth shocks for Italian households. Large asset price shocks in 2008 underpin an IV estimator. A euro fall in financial or risky financial wealth resulted in cuts in annual total (non-durable) consumption of 5-9 (3.5-6) cents. There is evidence of effects for food spending. Responses of total and non-durable spending to changes in housing wealth are 0.2 to 0.4 cents/euro. Counterfactuals indicate financial wealth effects were important (relative to other factors) for consumption falls in 2008/09. Thus wealth effects on consumption can be important for households' welfare and aggregate outcomes.
Keywords: wealth effects; household consumption; 2008 crisis (search for similar items in EconPapers)
JEL-codes: D12 D91 G01 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ure
References: View complete reference list from CitEc
Citations: View citations in EconPapers (12) Track citations by RSS feed
Downloads: (external link)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://www.ifs.org.uk/wps/wp201321.pdf [301 Moved Permanently]--> https://www.ifs.org.uk/wps/wp201321.pdf [302 Found]--> https://ifs.org.uk/wps/wp201321.pdf)
Working Paper: Wealth Effects and the Consumption of Italian Households in the Great Recession (2017)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:ifs:ifsewp:13/21
Ordering information: This working paper can be ordered from
The Institute for Fiscal Studies 7 Ridgmount Street LONDON WC1E 7AE
Access Statistics for this paper
More papers in IFS Working Papers from Institute for Fiscal Studies The Institute for Fiscal Studies 7 Ridgmount Street LONDON WC1E 7AE. Contact information at EDIRC.
Bibliographic data for series maintained by Emma Hyman ().