Consumer Confidence in Recovery Period From a Microeconomic Perspective Open Access

Zhang, Yuxue (2014)

Permanent URL:


Consumer Confidence in Recovery Period From a Microeconomic Perspective By Yuxue Zhang

Consumer Confidence is an economic indicator, which measures the degree of optimistic that consumers feel about the overall status of the economy and their personal financial situations. People's confidence in the economy or their personal financial situation will significantly influence their purchasing decisions. As many scholars have done research on relationship between macroeconomic data and consumer confidence, few work have focused on how do those macroeconomic factors affect consumer confidence within different demographic groups.

Using OLS regression method, I derive data from Survey of Consumer Behavior and Attitude and use the Index of Consumer Expectation as the proxy for consumer confidence. I used four groups of variables to examine the effect of macroeconomic and microeconomic factors: macroeconomics factors, personal characteristics, news heard and their interactions. I observe the macroeconomic effects on consumer confidence with respect to confidence in government, holding stocks or not, gender, income level and education.

I find that not only macroeconomic factors affect people's expectation towards future economy; their effects are weighted by different demographic characteristics. People with different gender, education level, confidence in government, financial instrument holdings and income level have different sensitivity and response differently to variation of macroeconomic data. Also, men and people who are confident in the government tend to be more optimistic about the economy intuitively compared with other demographic groups.

Given these findings, government and financial service institutions issue take demographic characteristics into consideration when issuing stimulus and financial products. Understanding the different effect of macroeconomic on consumer confidence would help them to better interpret consumer confidence in economic analysis and evaluating financial confidence and find more efficient approach to stimulate consumption.

Table of Contents

Table of Contents

I. Introduction & Literature Review ···························· 1

II. Data & Methodology ············································5

III. Results & Analysis ·············································9

Section. 3.1···························································10

Section 3.2····························································12

Section 3.3 ···························································14

Section 3.4 ···························································15

Section 3.5 ···························································17

Section 3.6 ···························································19

Section 3.7 ···························································20

IV. Conclusion ·······················································22

V. Figures & Graphs················································26

VI. Reference ·······················································36


About this Honors Thesis

Rights statement
  • Permission granted by the author to include this thesis or dissertation in this repository. All rights reserved by the author. Please contact the author for information regarding the reproduction and use of this thesis or dissertation.
  • English
Research Field
Committee Chair / Thesis Advisor
Committee Members
Last modified

Primary PDF

Supplemental Files