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Economic determinants of Croatian consumer confidence: real estate prices vs. macroeconomy

Author

Listed:
  • Petar Soric

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

  • Mateo Zokalj

    (InterCapital Securities, Zagreb, Croatia)

  • Marija Logarusic

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

Abstract

This article provides a starting point for the analysis of the determinants of consumer confidence in Croatia. Using Autoregressive Distributed Lag models, we analyse a wide array of macroeconomic drivers of consumer confidence. Despite the well-established fact that the Croatian economy is highly dependent of the real estate sector, consumers seem not to significantly react to real estate prices. On the other hand, we do find some evidence of a considerable long run impact of real wages, interest rates, and the general price level. In the short run, consumer confidence seems to also be responsive to stock market developments and unemployment. Overall, our estimates show that macroeconomic factors explain a lion's share of variability in consumer confidence.

Suggested Citation

  • Petar Soric & Mateo Zokalj & Marija Logarusic, 2020. "Economic determinants of Croatian consumer confidence: real estate prices vs. macroeconomy," Interdisciplinary Description of Complex Systems - scientific journal, Croatian Interdisciplinary Society Provider Homepage: http://indecs.eu, vol. 18(2B), pages 240-257.
    • Handle: RePEc:zna:indecs:v:18:y:2020:i:2:p:241-257
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    More about this item

    Keywords

    business and consumer surveys; consumer confidence; economic sentiment; real estate prices;
    All these keywords.

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • 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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