Is the Consumer Expenditure Survey Representative by Income?

John Sabelhaus, David Johnson, Stephen Ash, David Swanson, Thesia Garner, John Greenlees and Steve Henderson

No 19589, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Aggregate under-reporting of household spending in the Consumer Expenditure Survey (CE) can result from two fundamental types of measurement errors: higher-income households (who presumably spend more than average) are under-represented in the CE estimation sample, or there is systematic under-reporting of spending by at least some CE survey respondents. Using a new data set linking CE units to zip-code level average Adjusted Gross Income (AGI), we show that the very highest-income households are less likely to respond to the survey when they are sampled, but unit non-response rates are not associated with income over most of the income distribution. Although increasing representation at the high end of the income distribution could in principle significantly raise aggregate CE spending, the low reported average propensity to spend for higher-income respondent households could account for at least as much of the aggregate shortfall in total spending.

JEL-codes: C83 D12 (search for similar items in EconPapers)
Date: 2013-10
New Economics Papers: this item is included in nep-pbe
Note: EFG
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Citations: View citations in EconPapers (21)

Published as Is the Consumer Expenditure Survey Representative by Income? , John Sabelhaus, David Johnson, Stephen Ash, David Swanson, Thesia I. Garner, John Greenlees, Steve Henderson. in Improving the Measurement of Consumer Expenditures , Carroll, Crossley, and Sabelhaus. 2015

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Related works:
Chapter: Is the Consumer Expenditure Survey Representative by Income? (2014)
Working Paper: Is the Consumer Expenditure Survey representative by income? (2012)
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