Professor Thomas F. Crossley

MPCs were directly elicited from a representative sample of UK adults in July 2020 using receipt of a hypothetical unanticipated, one-time income payment. Reported MPCs are low, around 11% on average.

This working paper looks at the marginal propensity to consume from a representative sample of UK adults in July 2020. Reported MPCs are low, around 11% on average. They are higher, but still modest, for individuals in households with high current needs.

Researchers are often interested in the relationship between two variables, with no single data set containing both.

Using new data from the Understanding Society: COVID 19 survey collected in April 2020, we show how the aggregate shock caused by the pandemic affects individuals across the distribution.

Household borrowing and spending rise with house prices, particularly for leveraged households, but household spending is not consumption.

Consumption Euler equations are important tools in empirical macroeconomics. When estimated on micro data, they are typically linearized, so standard IV or GMM methods can be employed to deal with the measurement error that is endemic to survey data. However, linearization, in turn, may induce serious approximation bias.

Researchers are often interested in the relationship between two variables, with no single data set containing both. For example, surveys on income and wealth are often missing consumption data.

A substantial body of research on the UK’s National Minimum Wage (NMW) has concluded that the the NMW has not had a detrimental effect on employment. This research has directly influenced, through the Low Pay Commission, the conduct of policy, including the subsequent introduction of the National Living Wage (NLW).

Each year, the UK experiences excess winter mortality (EWM). In 2014/2015, the number of excess winter deaths in England and Wales was estimated at 43,900, the highest level since 1999.

In an influential paper, Deaton and Paxson (1998) raise an important puzzle inunderstanding returns to scale in household consumption. They note that, holding percapita resources constant, returns to scale (in at least some goods) imply that larger households are better off, and so should consume more of private goods such as food. However, they document in a range of data sets that larger households have lower per capita food expenditures (holding per capita resources constant).

The Hamilton method for estimating CPI bias is simple, intuitive, and has been widely adopted. We show that the method conflates CPI bias with variation in cost-of-living across income levels.

A growing literature on inference in difference-in-differences (DiD) designs has been pessimistic about obtaining hypothesis tests of the correct size, particularly with few groups.