Working Paper: CEPR ID: DP15538
Authors: Jacques Melitz; Anthony Edo
Abstract: The scale of the rise in personal wealth following the Black Death calls the life-cycle hypothesis of consumption into consideration. This paper shows for the first time that the wealth effect of the Black Death on the price level continued in England for generations, up to 1450. Indeed, in absence of consideration of the wealth effect, other influences on the price level do not even appear in the econometric analysis. The separate roles of coinage, population, trade, wages and annual number of days worked for wages all also receive attention and new results follow for adjustment in the labor market.
Keywords: No keywords provided
JEL Codes: N13; J11; F33; J46
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| rise in personal wealth following the Black Death (N93) | price level in England (P22) |
| wealth effect (E21) | increased consumer spending (D12) |
| increased consumer spending (D12) | inflation (E31) |
| inflation (E31) | demand for goods (D12) |
| inflation (E31) | demand for labor (J23) |
| wealth effect (E21) | shift in consumption patterns towards foreign goods (F61) |
| growth of wealth (O49) | price level changes (E30) |
| number of days worked per wage earner (J31) | price level changes (E30) |
| population growth (J11) | price level (E30) |
| wealth effect (E21) | moderated effect of population growth on price level (J11) |