Consumption patterns and wealth effects in Europe: A meta-analysis

This paper performs a meta-analysis on the relationship between household wealth and consumption in developed and emerging European economies. Based on 120 estimates extracted from 42 empirical studies, the findings confirm the positive wealth effect and suggest that housing wealth effects are more pronounced than financial wealth effects, while there is no significant distinction identified between developed and emerging European markets. The results reveal substantial heterogeneity across studies, driven by methodological choices, publication characteristics, and data differences. Meta-regression analysis highlights the role of income as a key moderator for housing wealth effects, while financial wealth effects are more sensitive to estimation methods. Publication bias is evident, particularly in studies on total and financial wealth, though adjustments confirm a persistent wealth effect. The findings emphasise the need for further research to refine wealth effect estimates and better capture differences across financial systems and economic structures.