consumption-saving behavior. We construct a novel consumption-saving model where the household must infer the persistent component … marginal propensity to consume because the short run covariance between income growth and consumption growth increases when … can be identified from panel data on income and consumption. Finally, we estimate a high degree of knowledge in the Panel …

proposed. These expectation adjustments generate highly heterogenous consumption responses to income windfalls: many households … previous explanations for these effects, including consumption adjustment cost and liquidity constraints. At the aggregate … level, consumption is less sensitive to expansionary policies during recessions and its excess smoothness varies …

We study the cyclical dynamics of consumption in the euro area (EA) and the large EA countries by distinguishing … cross-country heterogeneity in how different factors (including durable-specific ones) explain consumption; (iii) the … strength of spillovers from durable to nondurable consumption, as predicted by theory, is empirically correlated with how much …

preference theory. It measures willingness-to- pay for others’ consumption and willingness-to-pay for equality in consumption by … evaluating consumption externalities in monetary terms. We introduce an al- truism parameter and an inequality aversion parameter …

ex-ante homeowners who rate (cash-out) refinance an existing loan to increase savings (consumption) are significantly …

"cash-out refinance" an existing loan to fund current consumption are significantly more likely to overestimate their house …

Utilizing the asset pricing framework, we justify S-shaped consumption utility functions by reconciling realized … consumption with asset returns. The S-shaped consumption utility predicts a possible negative correlation between asset returns … and lower quantiles of consumption growth, for which we find evidence from micro-level data. This evidence refutes a …