Multi-Horizon Financial and Housing Wealth Effects across the US States

Creative Commons License

Coşkun Y., Bouras C., Gupta R., Wohar M. E.

SUSTAINABILITY, vol.13, no.3, 2021 (SCI-Expanded) identifier identifier

  • Publication Type: Article / Article
  • Volume: 13 Issue: 3
  • Publication Date: 2021
  • Doi Number: 10.3390/su13031341
  • Journal Name: SUSTAINABILITY
  • Journal Indexes: Science Citation Index Expanded (SCI-EXPANDED), Social Sciences Citation Index (SSCI), Scopus, Aerospace Database, CAB Abstracts, Communication Abstracts, Food Science & Technology Abstracts, Geobase, INSPEC, Metadex, Veterinary Science Database, Directory of Open Access Journals, Civil Engineering Abstracts
  • Keywords: consumption, housing wealth effect, financial wealth effect, multi-step causality, STOCK-MARKET WEALTH, LINEAR-DEPENDENCE, REAL-ESTATE, CYCLE, CONSUMPTION, HYPOTHESIS, PRICES, CAUSALITY, FEEDBACK, OUTPUT
  • TED University Affiliated: No


We investigate for the presence of multi-horizon wealth effects across U.S. states over the period of 1975:Q2 to 2012:Q2 by utilizing multi-horizon non-causality testing and multi-horizon causality measurement. At the state/aggregate level, we document that housing wealth has more statistically significant and persistent impact on private consumption than financial wealth. We also find that state-level housing/financial wealth effects are present at long time horizons and exhibit heterogeneity across the U.S. From a policy perspective, we suggest that state-level policies may specifically utilize the housing market to support consumption and growth.