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Does the transmission of economic policies and structural shocks vary with the state of the economy? We answer this question using a strategy based on quantile regressions, which account for both endogeneous regressors and state-dependent parameters. An application to U.S. real activity and...
Persistent link: https://www.econbiz.de/10011083570
There is widespread disagreement about the role of housing wealth in explaining consumption. This paper exploits liquid …, to explain fluctuations in the ratios of consumption and household debt to income in South Africa, from 1971 to 2005. The … variable with key interactions with drivers of consumption and debt. Credit conditions are proxied by a spline function …
Persistent link: https://www.econbiz.de/10011084339
effects of monetary policy shocks on house prices and consumption in a sample of OECD countries. With frictionless credit …) at the business cycle frequency, the correlation between consumption and house prices increases with the degree of … flexibility/development of mortgage markets; (3) the transmission of monetary policy shocks on consumption and house prices is …
Persistent link: https://www.econbiz.de/10005123820
This paper evaluates the macroeconomic and distributional effects of government bailout guarantees for Government Sponsored Enterprises (such as Fannie Mae and Freddy Mac) in the mortgage market. In order to do so we construct a model with heterogeneous, infinitely lived households and...
Persistent link: https://www.econbiz.de/10009351520
Consumption Expenditure Survey (CEX) to estimate individual-level impulse responses as well as multipliers for government spending … tend to decrease consumption inequality, whereas tax policy shocks most negatively affect the lives of the poor, more so … than the rich, thus increasing consumption inequality. …
Persistent link: https://www.econbiz.de/10011083875
Financial markets are incomplete, thus for many households borrowing is possible only by accepting a financial contract that specifies a fixed repayment. However, the future income that will repay this debt is uncertain, so risk can be inefficiently distributed. This paper argues that a monetary...
Persistent link: https://www.econbiz.de/10011084046
We study a model with repeated moral hazard where financial contracts are not fully indexed to inflation because nominal prices are observed with delay as in Jovanovic and Ueda 1997. More constrained firms sign contracts that are less indexed to inflation and, as a result, their investment is...
Persistent link: https://www.econbiz.de/10011145464
policy shocks on aggregate consumption and for the impact on inflation that other models have hard a time explaining. In …
Persistent link: https://www.econbiz.de/10005791798
Low domestic saving rates in South Africa may perpetuate a low-growth trap. The decline in government saving, a major reason for the overall decline in saving, is now being reversed. However, personal saving rates have fallen since 1993, and corporate rates since 1995, and both may decline...
Persistent link: https://www.econbiz.de/10005124249
The consumption Euler equation is a building block of modern macro theory. Yet, the existing evidence on aggregate data … state of the economy. The nonlinear method reveals that during periods in which consumption is above its conditional average … value) than the estimates associated with periods of below-average consumption. Our evidence is consistent with models of …
Persistent link: https://www.econbiz.de/10008854511