Consumption Volatility, Marketization, and Expenditure in an Emerging Market Economy

• 成果类型: Article
• 署名作者: Hicks, Daniel L.
• 署名单位: University of Oklahoma System; University of Oklahoma - Norman
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MACROECONOMICS
• ISSN/ISSBN: 1945-7707
• DOI: 10.1257/mac.20120222
• 发表日期: 2015
• 页码: 95-123
• 关键词: household production; business-cycle; time; allocation

摘要

In response to income fluctuations, households smooth consumption by substituting between market expenditure and time inputs. This paper provides evidence of this substitution in the context of food consumption over transitory and permanent income fluctuations in Mexico. Household time investments drive a wedge between consumption and expenditure, amplifying measured expenditure volatility. Volatility decompositions for Mexico and the United States suggest that the extent of bias in expenditure-based measures induced by changes in marketization is relatively larger in the Mexican setting. These findings imply that volatility comparisons between commodities or across countries are misleading when consumption measures ignore home production.