Consumption Partial Insurance of Spanish Households

45 Pages Posted: 2 Mar 2012

Date Written: March 2, 2012


This paper measures how households smooth changes in consumption when incomes are shifted by permanent or transitory shocks at country and regional level. I compute insurance capacity using the Spanish Continuous Family Expenditure Survey skipping the imputation methods used by the previous literature to mitigate the significant lack of income and consumption panel data information. I find some partial insurance for permanent shocks and a downward bias when imputed data are used. There is significant sensitivity for the youngest and primary educated cohorts that becomes more relevant in some regions. I obtain that durable purchases are a source of insurance with respect to transitory shocks and the effect of family income transfers is almost negligible.

Keywords: Consumption, income, insurance

JEL Classification: D12, D91, I30

Suggested Citation

Casado, Jose Maria, Consumption Partial Insurance of Spanish Households (March 2, 2012). Banco de Espana Working Paper No. 1214, Available at SSRN: or

Jose Maria Casado (Contact Author)

Banco de España ( email )

Alcala 50
Madrid 28014

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