We study the cyclical dynamics of consumption in the euro area (EA) and the large EA countries by distinguishing … cross-country heterogeneity in how different factors (including durable-specific ones) explain consumption; (iii) the … strength of spillovers from durable to nondurable consumption, as predicted by theory, is empirically correlated with how much …

Most of the empirical literature on consumption behaviour over the last decades has focused on estimating Euler … policy relevant issues. Alternatively, many papers have proposed using the consumption function to forecast behaviour. This … paper follows in this tradition, by deriving an analytical consumption function in the presence of intertemporal non …

realizations is front loaded, a closed form aggregate consumption function with CRRA preferences is derived. To have a closed form … solution we assume that consumers solve their intertemporal optimization problem sequentially. First they assess riskadjusted … life-time wealth and then the optimal consumption path. The derived model captures precautionary saving, which is dependent …

In this paper we examine the link between wage inequality and consumption inequality using a life cycle model that … incorporates household consumption and family labour supply decisions. We derive analytical expressions based on approximations for … the dynamics of consumption, hours, and earnings of two earners in the presence of correlated wage shocks, non …

Households' income heterogeneity is important to explain consumption dynamics in response to aggregate macro … uncertainty: an increase in uncertainty generates a consumption drop that is stronger for income poorer households. At the same … who, being subject to higher unemployment risk, contract consumption more in response to heightened uncertainty, and firms …

homogeneous MPC rates. Consumption inequality is countercyclical in this setting and a high degree of leverage amplifies the …