U.S. Rebates Lift Consumer Spending

U.S. Rebates Lift Consumer Spending

The Wall Street Journal reported Wednesday that the U.S. government’s economic-stimulus payments are helping to boost consumer spending. 

A new study by two professors at Northwestern University’s Kellogg School of Management and the University of Chicago’s Graduate School of Business found that a typical family spent 3.5% more on food, medicines, and other daily essentials when the rebates arrived.

The results also show that the rebates boosted consumption of nondurable goods, which excludes large purchases, by 4.1% during the second quarter of 2008.

The study, which used ACNielsen data on consumer purchases — paired with consumer surveys, is the first to calculate the effects of the 2008 stimulus program.