MPCs in an economic crisis: spending, saving and private transfers

Publication type

Journal Article

Authors

Publication date

September 15, 2021

Summary:

MPCs were directly elicited from a representative sample of UK adults in July 2020 using receipt of a hypothetical unanticipated, one-time income payment. Reported MPCs are modest, around 11% on average. They are higher, but still modest, for individuals in households with high current needs. Significant fractions of respondents report they would use a windfall to pay down debt, or that they would change their transfer payments to or from family and friends. The latter means that the aggregate MPC out of a stimulus payment need not equal the population-average MPC.

Published in

Journal of Public Economics Plus

Volume

Volume: 2:100005

DOI

https://doi.org/10.1016/j.pubecp.2021.100005

ISSN

26665514

Subjects

Notes

Open Access

Under a Creative Commons license

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