The Effect of the Fracking Boom on Non-Durable Consumer Expenditure: Evidence From Consumer Scanner Data

51 Pages Posted: 8 Nov 2018 Last revised: 14 Jan 2019

Date Written: January 11, 2019

Abstract

I use consumer scanner data to study the response of non-durable consumer expenditure to a localized economic shock induced by the fracking boom in the U.S. The identification strategy utilizes the spatial variation in the location of geological resources and the variation in the timing of the fracking boom across the U.S. Using difference-in-differences and event study approaches, I find on average 4.4% quarterly increase in the household expenditure on non-durable goods in areas affected by fracking. I find no difference in the effects on nominal expenditure and real consumption. I also examine changes in composition of consumer baskets, and heterogeneous effects by age, income, and education.

Keywords: Fracking Boom, Consumer Expenditure, Consumer Scanner Data

JEL Classification: E21, E24, Q33

Suggested Citation

Lazhevska, Nadiia, The Effect of the Fracking Boom on Non-Durable Consumer Expenditure: Evidence From Consumer Scanner Data (January 11, 2019). Available at SSRN: https://ssrn.com/abstract=3267144 or http://dx.doi.org/10.2139/ssrn.3267144

Nadiia Lazhevska (Contact Author)

Stockholm School of Economics ( email )

P.O. Box 6501
Sveavagen 65
Stockholm
Sweden

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