Cost of Living Inequality During the Great Recession
By David Argente, Munseob Lee. Journal of the European Economic Association, 2016
129 citations recorded by the source corpus.
We construct income-specific price indexes for the period from 2004 to 2016. We find substantial differences across income groups that arise during the Great Recession. The difference in annual inflation between the lowest quartile of the income distribution and the highest quartile was 0.22 percentage points for 2004–2007, 0.85 percentage points for 2008–2013, and 0.02 percentage points for 2014–2016. We find that product quality substitution and changes in the shopping behavior, margins mostly available to richer households, explain around 40% of the gap. Our evidence shows that not accounting for these differences in price indexes could lead to significant biases in the calculation of consumption and income inequality.
View Paper: https://www.semanticscholar.org/paper/117f00e18a701332edbe31aa9ca651afe9231b40
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Citations in the corpus
- Inflation with Covid Consumption Baskets (2020, unknown): “In more recent years, Kaplan and Schulhofer-Wohl (2017), Argente and Lee (2017), and Jaravel (2019) used scanner data to study mechanisms that can increase the inflation experienced by low-income households within narrower categories of goods.”
- Are Poor Cities Cheap for Everyone? Non-Homotheticity and the Cost of Living Across U.S. Cities (2013, methodology): “Broda and Romalis (2009), and subsequent papers by Argente and Lee (2016) and Jaravel (2018), use the Feenstra (1994) methodology to calculate price indexes that are exact to a nested-CES utility function similar to the one above, but with two key differences.”
- Exposure to Daily Price Changes and Inflation Expectations (2019, unknown): “and employment status are conceivably correlated with consumption bundles and hence the prices individuals who differ along these dimension see during their shopping trips (see Argente and Lee (2017) and Kaplan and Schulhofer-Wohl (2017) for differences in experienced inflation by income).”