Asymmetric Consumption Smoothing

In data from an account aggregator, households increase consumption when they receive (expected) tax refunds, as if they are liquidity constrained. However, this behavior is not due to liquidity constraints or hand-to-mouth behavior. These same households smooth consumption when making payments in other years, primarily by transferring funds among liquid accounts. Further, even households carrying credit card debt smooth consumption when making payments, and even high-liquidity households spend out of refunds. Thus the households we study follow a heuristic of spending out of increases in liquidity, while at the same time acting in anticipation of payments to maintain stable consumption