The Effect of the Proportions of Housing Wealth and Financial Wealth on Consumption
GLOBAL BUSINESS & FINANCE REVIEW 2014 Vol. 19, No. 1
2014.6, pp. 53-58 (6pages)
DOI :
Http://dx.doi.org/10.17549/gbfr.2014.19.1.53
Publisher : People & Global Business Association
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Young Seob Son1
Bemidji State University, Bemidji, MN, USA.(1)
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Abstract
This note offers a theoretical model to prove that the proportions of housing wealth and financial wealth may play a key role in estimating and analyzing the marginal propensities to consume (MPCs) out of housing wealth and financial wealth and analyzing the effects of volatilities on both MPCs. Additional interesting result is that the higher proportions of housing wealth and financial wealth reduce the certainty effect of the preference for housing wealth.\r\n
- Keywords : Housing Wealth, Financial Wealth, Marginal Propensities to Consume