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Identifying the Interdependence between Consumer Confidence and Macroeconomic Developments in Croatia

Author

Listed:
  • Marina Matosec

    (University of Zagreb - Faculty of Economics and Business, Zagreb, Croatia)

  • Zdenka Obuljen Zoricic

    (University of Dubrovnik - Department of Economics and Business Economics, Dubrovnik, Croatia)

Abstract

This article represents an empirical attempt to discern the interrelationship between consumer confidence and macroeconomic trends in Croatia. Previous studies that employ both subjective and objective variables show that consumer confidence, consumption and gross domestic product in other countries are interdependent to a great extent. Apart from the mentioned variables, our study additionally includes savings, as another important determinant in the households' economic decision making. The results indicate that consumer confidence Granger-causes all selected macroeconomic variables and vice versa. Not surprisingly, there are also many significant interrelations between the macroeconomic variables. These findings confirm the predictive ability of consumer confidence in Croatia and suggest that combining subjective and objective indicators has an important role in understanding households' economic behaviour.

Suggested Citation

  • Marina Matosec & Zdenka Obuljen Zoricic, 2019. "Identifying the Interdependence between Consumer Confidence and Macroeconomic Developments in Croatia," Interdisciplinary Description of Complex Systems - scientific journal, Croatian Interdisciplinary Society Provider Homepage: http://indecs.eu, vol. 17(2-B), pages 345-354.
    • Handle: RePEc:zna:indecs:v:17:y:2019:i:2-b:p:345-354
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    References listed on IDEAS

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    More about this item

    Keywords

    consumer confidence; consumption; savings; GDP; Granger causality;
    All these keywords.

    JEL classification:

    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • E71 - Macroeconomics and Monetary Economics - - Macro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on the Macro Economy

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