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.