adjustment costs can cause a mean-preserving increase in unemployment risk to lead to increased consumption. The predictions of … risk as their unemployment shocks are more highly correlated. Such couples spend more on owner-occupied housing than other … usual relationship between risk and consumption. In particular, we present a model where the presence of plausible …

looking at the expenditure response of workers to the change in unemployment risk measured at the occupational level. We find … that occupational unemployment risk does not have a large impact on consumption expenditure. However, despite investigating … multiple forms of occupational unemployment risk for multiple expenditure categories in two expenditure surveys (PSID, CEX), we …

two channels in driving aggre- gate consumption fluctuations in the US: (i) precautionary savings against un- employment … risk and (ii) MPC heterogeneity. I find that MPC heterogeneity is the dominant channel because a large fraction of …, indicating an MPC puzzle. This is because the likelihood-based estimation favors a low degree of nominal rigidity and responsive …