Household Reaction to Changes in Housing Wealth
It is widely claimed that housing wealth, as well as stock prices, have an impact on consumption and hence on aggregate economic activity. This paper presents a broad overview of the issues that arise in evaluating this claim in the context of recent research in behavioral economics. Particular attention is paid to a model of the response of consumption to wealth components produced by Christopher Carroll .
Shiller, Robert J., "Household Reaction to Changes in Housing Wealth" (2004). Cowles Foundation Discussion Papers. 1735.