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Business Context

BFI working paper: Income, Liquidity, and the Consumption Response to the 2020 Economic Stimulus Payments

Updated Oct 9, 2020 at 10:15 AM EST

A working paper published last month by the Becker Friedman Institute for Economics at the University of Chicago, used data from the financial nonprofit SaverLife. The people they studied were largely lower- and middle-income, with a median annual after-tax income of $25,000. The research found wide variation in how people reacted to having the extra money. Those with less than $100 in their bank accounts spent over 40 percent of their checks within the first month, while people with more than $4,000 in their accounts spent a statistically insignificant 11 percent.

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A working paper published last month by the Becker Friedman Institute for Economics at the University of Chicago, used data from the financial nonprofit SaverLife.