This paper examines the sources of stickiness in aggregate consumption growth. We first derive a dynamic consumption equation which encompasses many recent developments in consumption theory: habit formation, intertemporal substitution effects, consumption based on current income, and...

We investigate the importance of aggregate and consumer-specific or idiosyncratic labour income risk for aggregate consumption changes in the US over the period 1952-2001. Theoretically, the effect of labour income risk on consumption changes is decomposed into an aggregate and into an...

This paper uses housing returns to estimate the elasticity of intertemporal substitution (EIS) in consumption for fifteen advanced economies over the postwar period 1950 − 2015. As housing is the main asset for the majority of households, returns on housing are better suited to estimate the...