Working Paper: NBER ID: w20122
Authors: Christian Broda; Jonathan A. Parker
Abstract: Using a survey of households in the Nielsen Consumer Panel and the randomized timing of disbursement of the 2008 Economic Stimulus Payments, we find that a household's spending rose by ten percent the week it received a Payment and remained high cumulating to 1.5-3.8 percent of spending over three months. Our estimates imply partial-equilibrium increases in aggregate demand of 1.3 percent of consumption in the second quarter of 2008 and 0.6 percent in the third. Spending is concentrated among households with low wealth or low past income; a household's spending did not increase significantly when it learned about its Payment.
Keywords: Economic Stimulus Payments; Aggregate Demand; Consumer Spending
JEL Codes: D12; D91; E21; E62
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| households with low wealth or low past income (G51) | household spending (D10) |
| receipt of economic stimulus payments (ESPs) (H53) | impulse response of spending (E20) |
| timing of receipt of economic stimulus payments (ESPs) (H53) | household spending (D10) |
| receipt of economic stimulus payments (ESPs) (H53) | household spending (D10) |
| anticipation of receiving economic stimulus payments (ESPs) (D84) | household spending (D10) |