Economic theory predicts that consumption growth rates should be highly correlated across countries. Empirical evidence … integration has a limited impact upon cross-country consumption correlations, labour market rigidities significantly increase … consumption correlations. The results suggest that labour market rigidities improve the allocation of consumption risks either by …

This paper examines how bilateral economic linkages shape consumption synchronization across economies. Using state …-level data from the US, we find that the degree of bilateral consumption risk sharing decreases with geographic distance. To … channels and disentangle their effects on the level, volatility, and comovement of consumption. Counterfactual analyses based …