{
  "title": "Drivers of Post-COVID Private Consumption in the U.S.",
  "publication": "IMF Working Papers, June 21, 2024",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2024/06/21/drivers-of-post-covid-private-consumption-in-the-u-s-550895",
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  "summary": "Private consumption in the U.S. has recovered swiftly from the pandemic trough and has been running above the pre-pandemic trend even as interest rates rose sharply. This paper examines the underlying drivers for this strong growth in consumption.",
  "sections": [
    {
      "heading": "Summary of core findings",
      "content": "- Private consumption in the U.S. recovered swiftly from the pandemic trough and has been running above the pre-pandemic trend even as interest rates rose sharply.\n- Using both state- and household-level data, the analysis identifies three main contributors to strengthened post-pandemic consumption:\n  - Excess savings accumulated during the pandemic.\n  - Large increases in household wealth, especially housing wealth.\n  - Solid real income gains.\n- The paper finds that, compared with pre-COVID estimates, the marginal propensity to consume out of housing wealth is substantially higher.\n- Large gains in housing prices, together with the elevated marginal propensity to consume out of housing wealth, made the wealth effect a key driver for post-pandemic consumption growth."
    },
    {
      "heading": "Methodology and data scope",
      "content": "- Empirical approach: analysis based on both state-level and household-level data (methods and detailed estimations are presented in the working paper).\n- Focus areas: consumption dynamics, household wealth (with emphasis on housing), excess savings, real income."
    },
    {
      "heading": "Thematic subjects and keywords",
      "content": "- Subject: Consumption, COVID-19, Health, Housing, Income, National accounts, Private consumption\n- Keywords: Consumption, consumption growth, COVID recovery, COVID-19, Global, household wealth, Housing, housing wealth, Income, pandemic consumption, Private consumption"
    },
    {
      "heading": "Notable exact statements from the paper",
      "content": "- \"Private consumption in the U.S. has recovered swiftly from the pandemic trough and has been running above the pre-pandemic trend even as interest rates rose sharply.\"\n- \"Compared with pre-COVID estimates, the marginal propensity to consume out of housing wealth is substantially higher, which, together with large gains in housing prices, made the wealth effect a key driver for post-pandemic consumption growth.\"\n\nIMF Working Paper: Drivers of Post-COVID Private Consumption in the U.S., Working Paper No. 2024/128 (June 21, 2024) — Mai Dao, La-Bhus Fah Jirasavetakul, Jing Zhou.\n\n---\n\n Content in this bundle\n\n- Working Paper\n  - Working Paper (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Working Paper (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2024/06/21/drivers-of-post-covid-private-consumption-in-the-u-s-550895"
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    "Authors: Mai Dao, La-Bhus Fah Jirasavetakul, Jing Zhou",
    "Published: June 21, 2024",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9798400281044.001",
    "Private consumption in the U.S. recovered swiftly from the pandemic trough and has been running above the pre-pandemic trend even as interest rates rose sharply.",
    "Using both state- and household-level data, the analysis identifies three main contributors to strengthened post-pandemic consumption:",
    "The paper finds that, compared with pre-COVID estimates, the marginal propensity to consume out of housing wealth is substantially higher.",
    "Large gains in housing prices, together with the elevated marginal propensity to consume out of housing wealth, made the wealth effect a key driver for post-pandemic consumption growth.",
    "Empirical approach: analysis based on both state-level and household-level data (methods and detailed estimations are presented in the working paper).",
    "Focus areas: consumption dynamics, household wealth (with emphasis on housing), excess savings, real income.",
    "Subject: Consumption, COVID-19, Health, Housing, Income, National accounts, Private consumption",
    "Keywords: Consumption, consumption growth, COVID recovery, COVID-19, Global, household wealth, Housing, housing wealth, Income, pandemic consumption, Private consumption",
    "\"Private consumption in the U.S. has recovered swiftly from the pandemic trough and has been running above the pre-pandemic trend even as interest rates rose sharply.\"",
    "\"Compared with pre-COVID estimates, the marginal propensity to consume out of housing wealth is substantially higher, which, together with large gains in housing prices, made the wealth effect a key driver for post-pandemic consumption growth.\"",
    "**Working Paper**"
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