faced by consumers. We use the structure of an economy with collateralized household debt and housing markets to develop and … illustrate this concept. Our approach determines the specific range of debt levels at which this economy is vulnerable to crises … of confidence, as well as the debt‐level‐specific extent of confidence‐driven house price fluctuations. …

and household welfare. We estimate Euler equations and measure the volatility of unpredictable changes in consumption as …, and document that despite the increase in household debt between 1983 and 2007, there was no decline in the proportion of …We evaluate the impact of increased income uncertainty and financial liberalization in the US on consumption volatility …

negative equity. These may give rise to credit constraints and buffer-stock savings. Savings may be built up not only to … finance future consumption, but also to deleverage, since high indebtedness makes the access to additional credit more …Since the onset of the financial crisis, income and consumption have fallen sharply in Ireland, particularly for young …