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Representing consumption and saving without a representative consumer

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  • Carroll, Christopher D.

Abstract

The Great Recession confirmed a bedrock principle of modern consumption theory: It is impossible to explain aggregate spending behavior without knowledge of the underlying microeconomic distribution of circumstances and choices across households. National accounting frameworks therefore need to be augmented by "bottom up" measures that both (a) capture the microeconomic heterogeneity (in expenditures, income, assets, debt, and beliefs) in the population and (b) sum up to statistics that have a recognizable relationship to the aggregate totals that are already reasonably well measured.

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  • Carroll, Christopher D., 2014. "Representing consumption and saving without a representative consumer," CFS Working Paper Series 464, Center for Financial Studies (CFS).
    • Handle: RePEc:zbw:cfswop:464
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    Cited by:

    1. Bram De Rock & Bart Capéau, 2015. "The implications of household size and children for life-cycle saving," Working Paper Research 286, National Bank of Belgium.
    2. Michael M. Batty & Jesse Bricker & Joseph S. Briggs & Alice Henriques Volz & Elizabeth Ball Holmquist & Susan Hume McIntosh & Kevin B. Moore & Eric R. Nielsen & Sarah Reber & Molly Shatto & Kamila Som, 2019. "Introducing the Distributional Financial Accounts of the United States," Finance and Economics Discussion Series 2019-017, Board of Governors of the Federal Reserve System (U.S.).
    3. Michael Batty & Jesse Bricker & Joseph Briggs & Sarah Friedman & Danielle Nemschoff & Eric Nielsen & Kamila Sommer & Alice Henriques Volz, 2021. "The Distributional Financial Accounts of the United States," NBER Chapters, in: Measuring Distribution and Mobility of Income and Wealth, pages 641-677, National Bureau of Economic Research, Inc.

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    More about this item

    Keywords

    National Accounting; Inequality; Distribution;
    All these keywords.

    JEL classification:

    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

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