Replication data for: Why Don't Households Smooth Consumption? Evidence from a $25 Million Experiment

Principal Investigator(s): View help for Principal Investigator(s) Jonathan A. Parker

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Project Citation:

Parker, Jonathan A. Replication data for: Why Don’t Households Smooth Consumption? Evidence from a $25 Million Experiment. Nashville, TN: American Economic Association [publisher], 2017. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-12-07. https://doi.org/10.3886/E116408V1

Project Description

Summary: This paper evaluates theoretical explanations for the propensity of households to increase spending in response to the arrival of predictable, lump-sum payments, using households in the Nielsen Consumer Panel who received $25 million in randomly distributed stimulus payments. The pattern of spending is inconsistent with models in which identical households cycle rapidly through high and low-response states as they manage liquidity, but is instead highly predictable by income years before the payment. Spending responses are unrelated to expectation errors, almost unrelated to crude measures of procrastination and self-control, significantly related to sophistication and planning, and highly related to impatience.

Scope of Project

Subject Terms: beliefs,; sophistication; self-control; impatience; tax rebates; expectations; Consumption smoothing

JEL Classification:
      D12 Consumer Economics: Empirical Analysis
      D14 Household Saving; Personal Finance
      D91 Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
      E21 Macroeconomics: Consumption; Saving; Wealth
      H23 Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies

Geographic Coverage: United States

Time Period(s): 1/1/2006 – 12/30/2008

Data Type(s): program source code

Collection Notes: Data is available from the Nielsen Company and the KILTS Center at the University of Chicago Booth School.

Methodology

Unit(s) of Observation: Household/family (consumer unit),

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Published Versions

V1 [2019-12-07]

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