In this paper we examine the link between wage inequality and consumption inequality using a life cycle model that … incorporates household consumption and family labour supply decisions. We derive analytical expressions based on approximations for … the dynamics of consumption, hours, and earnings of two earners in the presence of correlated wage shocks, non …

This paper finds declining consumption expenditure between paydays, for a typical household in the working population …

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 …

with a bequest motive, health-dependent utility, and uncertain longevity and health. We allow the parameters of the bequest …

Various deviations from the Permanent Income consumption model with rational expectations have been discussed in the … literature, including loss aversion and liquidity constraints. In the existing literature, these two types of consumption … asymmetry are usually considered as mutually exclusive. Using a single data set for US personal consumption, income and wealth …

flexibly adjusting savings to income variations as assumed by the Permanent Income Hypothesis (PIH). Fixed amount saving … behaviour could thus imply a challenge to PIH-based standard models of consumption if it meant that a substantial share of … consumption to predictable income changes observed in Germany. -- Fixed Amounts Saving ; Permanent Income Hypothesis ; Consumption …