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How large are housing and financial wealth effects? A new approach

Carroll, Christopher D.; Otsuka, Misuzu; Slacalek, Jiri - 2010

This paper presents a simple new method for measuring `wealth effects' on aggregate consumption. The method exploits the stickiness of consumption growth (sometimes interpreted as reflecting consumption `habits') to distinguish between immediate and eventual wealth effects. In U.S. data, we...

Persistent link: https://www.econbiz.de/10011605329

Housing wealth isn't wealth

Buiter, Willem H. - 2009

A fall in house prices due to a change in its fundamental value redistributes wealth from those long housing (for whom the fundamental value of the house they own exceeds the present discounted value of their planned future consumption of housing services) to those short housing. In a closed...

Persistent link: https://www.econbiz.de/10010299557

Housing wealth isn't wealth

Buiter, Willem H. - In: Economics: The Open-Access, Open-Assessment E-Journal 4 (2010) 2010-22, pp. 1-29

A fall in house prices due to a change in fundamental value redistributes wealth from those long housing (for whom the fundamental value of the house they own exceeds the present discounted value of their planned future consumption of housing services) to those short housing. In a closed economy...

Persistent link: https://www.econbiz.de/10010301112

What Drives Personal Consumption? The Role of Housing and Financial Wealth

Slacalek, Jiri - 2009

I investigate the effect of wealth on consumption in a new dataset with financial and housing wealth from 16 countries. The baseline estimation method based on the sluggishness of consumption growth implies that the eventual (long-run) marginal propensity to consume out of total wealth is 5...

Persistent link: https://www.econbiz.de/10011605163

The housing stock, housing prices, and user costs: The roles of location, structure and unobserved quality

Halket, Jonathan; Nesheim, Lars; Oswald, Florian - 2020

Which housing characteristics are important for understanding homeownership rates? How are housing characteristics … theories of homeownership? Using the English Housing Survey, we estimate a selection model of the allocation of properties to … correlations between rent-to-price ratios and homeownership rates. These patterns are consistent with, among others, hypotheses of …

Persistent link: https://www.econbiz.de/10012621082

Risk patterns and correlated brain activities: Multidimensional statistical analysis of fMRI data with application to risk patterns

Myšičková, Alena; Song, Song; Majer, Piotr; Mohr, … - 2011

Decision making usually involves uncertainty and risk. Understanding which parts of the human brain are activated during decisions under risk and which neural processes underly (risky) investment decisions are important goals in neuroeconomics. Here, we reanalyze functional magnetic resonance...

Persistent link: https://www.econbiz.de/10010319198

How large is the housing wealth effect? A new approach

Carroll, Christopher D.; Otsuka, Misuzu; Slacalek, Jirka - 2006

This paper presents a simple new method for estimating the size of ‘wealth effects?on aggregate consumption. The method exploits the well-documented sluggishness of consumption growth (often interpreted as ‘habits?in the asset pricing literature) to distinguish between short-run and long-run...

Persistent link: https://www.econbiz.de/10010293502

How large is the housing wealth effect? A new approach

Carroll, Christopher D.; Otsuka, Misuzu; Slacalek, Jirka - 2006

This paper presents a simple new method for estimating the size of 'wealth effects' on aggregate consumption. The method exploits the well-documented sluggishness of consumption growth (often interpreted as 'habits' in the asset pricing literature) to distinguish between short-run and long-run...

Persistent link: https://www.econbiz.de/10010298349

Vermögenspreise und Konsum: Neue Erkenntnisse, amerikanische Erfahrungen und europäische Herausforderungen

Illing, Gerhard; Klüh, Ulrich - 2004

The article illustrates how the integration of modern theory of finance and stochastic dynamic macroeconomic analysis provides a deeper understanding of the link between asset prices and consumption. It shows that this approach gives only a partial explanation for recent trends in US...

Persistent link: https://www.econbiz.de/10010427415

Housing Wealth and Aggregate Consumption in Sweden

Chen, Jie - 2006

This paper extends the VECM cointegration model and PT (permanent-transitory) variance decomposition framework proposed by Lettau & Ludvigson (2004) and applies them on the Swedish data spanning from 1980q1 to 2004q4. There are strong statistical evidences that the movements of aggregate...

Persistent link: https://www.econbiz.de/10010321586