Heterogeneous consumers and fiscal policy shocks

Emily Anderson, Atsushi Inoue and Barbara Rossi

Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra

Abstract: This paper studies empirical facts regarding the effects of unexpected changes in aggregate macroeconomic fiscal policies on consumers that differ depending on individual characteristics. We use data from the Consumption Expenditure Survey to estimate individual-level responses and multipliers for government spending. We find that unexpected fiscal shocks have substantially different effects on consumers depending on their income and age levels: the wealthiest individuals tend to behave according to predictions of standard RBC models, whereas the poorest ones behave according to standard IS-LM (non- Ricardian) models, most likely due to credit constraints. Furthermore, government spending policy shocks tend to decrease consumption inequality.

JEL-codes: D1 E21 E4 E52 H31 I3 (search for similar items in EconPapers)
Date: 2011-02, Revised 2015-12
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://econ-papers.upf.edu/papers/1478.pdf Whole Paper (application/pdf)

Related works:
Journal Article: Heterogeneous Consumers and Fiscal Policy Shocks (2016)
Working Paper: Heterogeneous Consumers and Fiscal Policy Shocks (2015)
Working Paper: Heterogeneous Consumers and Fiscal Policy Shocks (2013)
Working Paper: Heterogeneous Consumers and Fiscal Policy Shocks (2012)
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:upf:upfgen:1478

Access Statistics for this paper

More papers in Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra
Bibliographic data for series maintained by ( this e-mail address is bad, please contact ).