MIT Libraries logoDSpace@MIT

MIT
View Item 
  • DSpace@MIT Home
  • MIT Open Access Articles
  • MIT Open Access Articles
  • View Item
  • DSpace@MIT Home
  • MIT Open Access Articles
  • MIT Open Access Articles
  • View Item
JavaScript is disabled for your browser. Some features of this site may not work without it.

Why Don’t Households Smooth Consumption? Evidence from a $25 Million Experiment

Author(s)
Parker, Jonathan A.
Thumbnail
Downloadmac.20150331.pdf (553.2Kb)
PUBLISHER_POLICY

Publisher Policy

Article is made available in accordance with the publisher's policy and may be subject to US copyright law. Please refer to the publisher's site for terms of use.

Terms of use
Article is made available in accordance with the publisher's policy and may be subject to US copyright law. Please refer to the publisher's site for terms of use.
Metadata
Show full item record
Abstract
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.
Date issued
2017-10
URI
http://hdl.handle.net/1721.1/112122
Department
Sloan School of Management
Journal
American Economic Journal: Macroeconomics
Publisher
American Economic Association
Citation
Parker, Jonathan A. “Why Don’t Households Smooth Consumption? Evidence from a $25 Million Experiment.” American Economic Journal: Macroeconomics 9, 4 (October 2017): 153–183 © 2017 American Economic Association
Version: Final published version
ISSN
1945-7707
1945-7715

Collections
  • MIT Open Access Articles

Browse

All of DSpaceCommunities & CollectionsBy Issue DateAuthorsTitlesSubjectsThis CollectionBy Issue DateAuthorsTitlesSubjects

My Account

Login

Statistics

OA StatisticsStatistics by CountryStatistics by Department
MIT Libraries
PrivacyPermissionsAccessibilityContact us
MIT
Content created by the MIT Libraries, CC BY-NC unless otherwise noted. Notify us about copyright concerns.