The effect of wealth on consumption is an issue of longstanding interest to economists. Analysts believe that … fluctuations in household wealth have driven major swings in economic activity. This paper considers so-called wealth effects - the … impact of changes in wealth on household consumption and the overall macroeconomy. There is an extensive existing literature …

This paper studies the role of wealth effects in the monetary transmission mechanism in New Keynesian models. We … propose a decomposition of consumption that extends the Slutsky equation to a general equilibrium setting. Wealth effects, and … nominal interest rates in the standard equilibrium. In RANK, wealth effects are determined, generically, by the revaluation of …

Keynesian (HANK) model. The model yields empirically realistic distributions of household wealth and marginal propensities to …

Keynesian (HANK) model. The model yields empirically realistic distributions of household wealth and marginal propensities to …