TY  - JOUR
AU  - Skinner,Jonathan
TI  - Housing Wealth and Aggregate Saving
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 2842
PY  - 1989
Y2  - February 1989
UR  - http://www.nber.org/papers/w2842
L1  - http://www.nber.org/papers/w2842.pdf
N1  - Author contact info:
Jonathan S. Skinner
Department of Economics
6106 Rockefeller Hall
Dartmouth College
Hanover, NH 03755
Tel: 603/646-2535
Fax: 603/646-2122
E-Mail: jonathan.skinner@dartmouth.edu
AB  - The recent appreciation in housing value can have large effects on aggregate saving. This paper uses a simulation model to show that aggregate saving will decline substantially if life cycle homeowners spend down their housing windfalls. Homeowners with a bequest motive, however, may save more to assist their children in buying the now more expensive housing. To test whether families spend their housing capital gains, I use housing, income, and consumption data from the Panel Study of Income Dynamics. While a cross-section time-series regression implies that housing wealth does affect saving, a fixed-effects model finds no effect.
ER  -