Wealth Effects in Emerging Market Economies

By Tuomas A. Peltonen, Ricardo M. Sousa, I. Vansteenkiste. Social Science Research Network, 2012

137 citations recorded by the source corpus.

We build a panel of 14 emerging economies to estimate the magnitude of wealth effects on consumption. Using modern econometric techniques and quarterly data, we show that: (i) wealth effects are statistically significant and relatively large in magnitude; (ii) stock market and housing wealth effects are, generally, smaller for Latin American emerging markets; and (iii) housing wealth effects have substantially increased for Asian emerging economies in recent years. Additionally, while housing wealth effects are more important in countries with low level of financial development or low income level, financial wealth effects are stronger for countries with high stock market capitalization.

Subfields: Accounting, Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/59f5bf1520b8a94e16fa196c920441ed9981b2b2

Citations in the corpus

• Wealth Effects on Consumption - Evidence from the Euro Area (2009, unknown): “Peltonen et al. (2009) show that, in emerging countries, housing wealth effects range between 2.8 and 5.0 cents, and stock market wealth effects lie between 2.6 and 3.0 cents.”