Many have argued that if labor income is difference stationary, the permanent income hypothesis predicts that consumption should be relatively volatile. In U.S. aggregate data, labor income is well ...

The prediction that consumption-income ratios should decline as income rises in cross-sectional data is a feature of Friedman's (1957) permanent income hypothesis and other consumption-smoothing ...

Policymakers often consider temporarily redistributing income from rich to poor households to stimulate the economy. This is based in part on the idea that poor households spend a larger share of ...

One of the debates within economics is whether consumption is driven by income or wealth. The outcome of this debate is important for policymakers; if the goal of policy is lifting or constraining ...

Economists have long argued over whether tax cuts stimulate the economy efficiently and, if they do, which kind of tax cut stimulates consumption best. Ironically, the debate begins with the proposal ...

Official income inequality statistics indicate a sharp rise in inequality over the past five decades. These statistics do not accurately reflect inequality because income is poorly measured, ...

Now that the dividend tax reduction is law, Republicans are already beginning to discuss their tax plans for next year. Such a rapid change in focus is likely to become part of the landscape in ...