Uncertainty about Welfare Effects of Consumption Fluctuations

CRED Working Paper No. 2011/01

37 Pages Posted: 26 Jan 2011

See all articles by Romain Houssa

Romain Houssa

CRED & CEREFIM, University of Namur

Date Written: January 25, 2011

Abstract

This paper proposes Bayesian estimates for welfare effects of consumption fluctuations and growth. Annual data from 82 developed and developing countries indicate a large degree of uncertainty as regards point estimates. Moreover, the comparison between the welfare gain from consumption stabilization and the welfare gain from growth yields inconclusive results for many developed and developing countries. These findings suggest the need for caution in drawing policy conclusions from point estimates

Keywords: Business Cycles, Growth, Welfare

JEL Classification: E52, F42, C33

Suggested Citation

Houssa, Romain, Uncertainty about Welfare Effects of Consumption Fluctuations (January 25, 2011). CRED Working Paper No. 2011/01 , Available at SSRN: https://ssrn.com/abstract=1747789 or http://dx.doi.org/10.2139/ssrn.1747789

Romain Houssa (Contact Author)

CRED & CEREFIM, University of Namur ( email )

8 Rempart de la Vierge
Namur, 5000
Belgium

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