Precautionary saving and consumption fluctuations

• 成果类型: Article
• 署名作者: Parker, JA; Preston, B
• 署名单位: Princeton University; Princeton University; Columbia University
• 刊物名称: AMERICAN ECONOMIC REVIEW
• ISSN/ISSBN: 0002-8282
• DOI: 10.1257/0002828054825556
• 发表日期: 2005
• 页码: 1119-1143
• 关键词: income; GROWTH; substitution; expectations; sensitivity; constraints

摘要

This paper uses the consumption Euler equation to derive a decomposition of consumption growth into four sources. These four sources are new information, and three sources of predictable consumption growth: intertemporal substitution, changes in the preferences for consumption, and incomplete markets for consumption insurance. Using household-level data, we implement this decomposition for the average growth rate of consumption expenditures on nondurable goods in the United States from 1982 to 1997. The economic importance of precautionary saving rivals that of the real interest rate, but the relative importance of each source of movement in the volatility of consumption is not precisely measured.