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Sustainable consumption and the economic well‐being of American households

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  • Daniel H. Cooper
  • Barry Z. Cynamon
  • Steven M. Fazzari

Abstract

“Sustainable consumption” defines a comprehensive measure of household economic well‐being that integrates income, assets, debt, transfers, and rates of return to estimate a feasible lifetime consumption path. We find that sustainable consumption anchors actual spending, with deviations in one period adjusting back toward the sustainable level in subsequent periods. After the Great Recession, sustainable consumption fell more than actual consumption, in part due to lower real asset returns. Decomposing sustainable consumption into its components reveals primary support from taxable income, but its share has declined while Social Security's has grown. Substantial differences are also evident across race‐ethnicity and educational levels.

Suggested Citation

  • Daniel H. Cooper & Barry Z. Cynamon & Steven M. Fazzari, 2026. "Sustainable consumption and the economic well‐being of American households," Economic Inquiry, Western Economic Association International, vol. 64(3), pages 955-975, July.
    • Handle: RePEc:bla:ecinqu:v:64:y:2026:i:3:p:955-975
    DOI: 10.1111/ecin.70046
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