Money Matters: Consumption Volatility Across the Income Distribution

Download File
020322-WP-Money Matters-Fisher and Hardy

Jonathan Fisher, Washington Center for Equitable Growth
Bradley L. Hardy, Georgetown University


Using the Consumer Expenditure Survey, we document the level and volatility of quarterly consumption across the socioeconomic distribution. While the measurement of well-being is focused on income, the secular and policy discourse prioritizes income-adequacy to meet family needs. This concern over income-adequacy centers on the capacity of families to predictably consume minimally acceptable levels of basic needs, and the social and economic mobility consequences of low consumption. Our results show a clear socioeconomic and demographic gradient of lower consumption amid higher consumption volatility for disadvantaged groups. Food and clothing exhibit relatively high levels of consumption volatility among low-income households.


Connect with us!

Explore the Equitable Growth network of experts around the country and get answers to today's most pressing questions!

Get in Touch