Consumption and the Great Recession

Mariacristina De Nardi, Eric French and David Benson

No 17688, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We document some key facts about aggregate consumption and its subcomponents over time. We then document the behavior of some important determinants of consumption, such as consumers' expectations about their future income, and changes in the consumers' wealth positions. Finally, we use a simple permanent income model to show that the observed drop in consumption during the Great Recession can be explained by the observed drops in wealth and income expectations.

JEL-codes: E10 E21 E31 H31 (search for similar items in EconPapers)
Date: 2011-12
New Economics Papers: this item is included in nep-dge, nep-mac and nep-mkt
Note: EFG PE
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

Published as Mariacristina De Nardi & Eric French & David Benson, 2012. "Consumption and the Great Recession," Economic Perspectives, Federal Reserve Bank of Chicago, issue Q I, pages 1-16.

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Journal Article: Consumption and the Great Recession (2012)
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