March 15, 2006

Households' response to wealth changes; do gains or losses make a difference

Consument schrikt van koersverlies

Press release

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Mauro Mastrogiacomo Read more
Dick Morks Read more

The sample period covers both the stock-market boom during the 90's, and the bear period afterwards. The results suggest that households react more to capital losses than to capital gains. Failing to take into account this asymmetry may seriously bias the estimates of the marginal propensity to consume out of wealth.


Mauro Mastrogiacomo Read more