Updating on Housing Wealth and Consumption in Sweden
(2017) NEKH02 20171Department of Economics
- Abstract
- Using the most recent data from 1996 to 2016, I examine the more current relationship between housing wealth and private consumption. I extend the Life-Cycle Hypothesis and separate wealth into housing wealth from financial wealth. The main method em-ployed is the Engle-Granger two-step method. Combined with the use of quarterly data, the method allows investigation of the long-term and short-term effects in one methodological framework. Several modifications of a baseline model are tested and compared in search for the best model. The results reinforce the findings of previous studies, that housing wealth has a substantial effect on consumption. The exact estimates may vary depending on the choice of theory and methodology. Nevertheless a... (More)
- Using the most recent data from 1996 to 2016, I examine the more current relationship between housing wealth and private consumption. I extend the Life-Cycle Hypothesis and separate wealth into housing wealth from financial wealth. The main method em-ployed is the Engle-Granger two-step method. Combined with the use of quarterly data, the method allows investigation of the long-term and short-term effects in one methodological framework. Several modifications of a baseline model are tested and compared in search for the best model. The results reinforce the findings of previous studies, that housing wealth has a substantial effect on consumption. The exact estimates may vary depending on the choice of theory and methodology. Nevertheless a considerable effort was made on data selection to ensure that the estimates can provide a reliable update on the relationship, which could be useful for economists and politicians alike. (Less)
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/8910006
- author
- Shen, Yue LU
- supervisor
-
- Klas Fregert LU
- organization
- course
- NEKH02 20171
- year
- 2017
- type
- M2 - Bachelor Degree
- subject
- keywords
- Life-Cycle Hypothesis, Engle-Granger, consumption, wealth, house prices
- language
- English
- id
- 8910006
- date added to LUP
- 2017-07-11 11:37:04
- date last changed
- 2017-07-11 11:37:04
@misc{8910006, abstract = {{Using the most recent data from 1996 to 2016, I examine the more current relationship between housing wealth and private consumption. I extend the Life-Cycle Hypothesis and separate wealth into housing wealth from financial wealth. The main method em-ployed is the Engle-Granger two-step method. Combined with the use of quarterly data, the method allows investigation of the long-term and short-term effects in one methodological framework. Several modifications of a baseline model are tested and compared in search for the best model. The results reinforce the findings of previous studies, that housing wealth has a substantial effect on consumption. The exact estimates may vary depending on the choice of theory and methodology. Nevertheless a considerable effort was made on data selection to ensure that the estimates can provide a reliable update on the relationship, which could be useful for economists and politicians alike.}}, author = {{Shen, Yue}}, language = {{eng}}, note = {{Student Paper}}, title = {{Updating on Housing Wealth and Consumption in Sweden}}, year = {{2017}}, }