CPG consumption in times of recession: Novel evidence from matched administrative data

Abstract

We exploit a novel data source that combines on the level of individual households administrative income and sociodemographic data from tax records with household scanner data for CPG consumption. We document significant unexplained variation in household expenditures and thereby reveal substantial scope for potential savings. Exploiting considerable within-household variation from the Dutch double-recession in the analysed period from 2011 to 2018, we find only an economically small relationship of expenditure with income, which is also not higher for households with low income or low savings. Albeit still small, the respective coefficient is larger for non-food expenditure, negative income changes, and particularly for single households.

Keywords: income effects, consumer-packaged goods, administrative data

JEL Classification: D12, E21, E32, M30