Matthew Wakefield

We look at how strongly shocks to asset values affect labour supply, using Italian data.

We estimate marginal propensities to consume from wealth shocks for Italian households in the early part of the Great Recession. Large asset price shocks in 2008 underpin an IV estimator. A euro fall in risky financial wealth resulted in cuts in annual total (non‐durable) consumption of 8.5‐ 9 (5.5‐5.7) cents. There is evidence of effects on food spending. Responses of total and nondurable spending to changes in housing wealth are 0.2 to 0.3 cents/euro. Point estimates of the effect of the financial wealth shock are larger if the youngest and/or oldest households are excluded. Results indicate that responses to the wealth shock were stronger for those who became pessimistic about the stock market, and for those owners of risky assets who also held mortgage debt. Counterfactuals indicate financial wealth effects were important (relative to other factors) for consumption falls in Italy in 2007/08.

We investigate whether different ages of first-time house buying lead to persistent differences in homeownership between cohorts.

We estimate marginal propensities to consume from wealth shocks for Italian households.

Using survey data spanning multiple house-price cycles over nearly forty years, this paper documents the association between house prices and homeownership at age thirty.

We model individual demand for housing over the life-cycle, and show the aggregate implications of this behaviour.

This paper uses a realistic structural lifecycle model of consumption and housing decisions to understand how data might distinguish different mechanisms that explain the correlation between house prices and consumption.

Contrary to the conventional wisdom that the Stakeholder Pension reforms had little or no impact on saving behaviour, our results indicate that the change to the contribution ceilings affected private pension coverage rates among lower-earners, especially among women.

This Commentary provides an assessment of the number of individuals likely to be affected by forthcoming reforms to private pensions.

This paper analyses the likely implications of the temporary cut in VAT in the UK to 15 per cent, with a return to 17.5 per cent in place for the end of 2009.

This Briefing Note provides a description of how the UK tax system treats the return to saving.

We look at the impact the government's cut in the VAT rate could have on people's spending.