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Fiscal Stimulus and Households' Non-Durable Consumption Expendituresː Evidence from the 2009 Australian Nation Building and Jobs Plan

Author

Listed:
  • Aisbett, Emma
  • Brueckner, Markus
  • Steinhauser, Ralf
  • Wilcox, Rhett

Abstract

In 2009 the Australian government delivered approximately $8 billion in direct payments to households. These payments were preannounced and randomly allocated to households based on postal codes over a 5-week period. We exploit this random allocation to estimate the causal response of households' non-durable consumption expenditures to a transitory, anticipated income increase. Our main findings are that: (i) non-durable consumption expenditures did not react significantly during or after the one-time, pre-announced transfer; (ii) there is a small, albeit statistically significant increase in non-durable consumption expenditures at the time of the announcement of the fiscal stimulus.
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Suggested Citation

  • Aisbett, Emma & Brueckner, Markus & Steinhauser, Ralf & Wilcox, Rhett, 2014. "Fiscal Stimulus and Households' Non-Durable Consumption Expendituresː Evidence from the 2009 Australian Nation Building and Jobs Plan," WiSo-HH Working Paper Series 11, University of Hamburg, Faculty of Business, Economics and Social Sciences, WISO Research Laboratory.
    • Handle: RePEc:zbw:uhhwps:11
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    File URL: https://www.econstor.eu/bitstream/10419/260417/1/wp11.pdf
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    Cited by:

    1. is not listed on IDEAS
    2. Sinclair Davidson & Ashton de Silva, 2013. "Stimulating Savings: An Analysis of Cash Handouts in Australia and the United States," Agenda - A Journal of Policy Analysis and Reform, Australian National University, College of Business and Economics, School of Economics, vol. 20(2), pages 39-60.
    3. Cho, Yunho & Morley, James & Singh, Aarti, 2019. "Marginal propensities to consume before and after the Great Recession," Working Papers 2019-11, University of Sydney, School of Economics, revised Sep 2021.

    More about this item

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making

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