Is there a gender difference in accurately predicting the sign of growth in durables spending?

ABSTRACT

The answer is yes, according to the Michigan Surveys of Consumers (MSC) data. A survey question under the ‘Household durables buying conditions’ category asks: ‘About the big things people buy for their homes – such as furniture, a refrigerator, stove, television, and things like that. Generally speaking, do you think now is a good time or a bad time for people to buy major household items?’ Using the individual responses, the MSC calculates a balanced index representing consumer durable buying attitudes separately for all, female, and male participants in addition to those in the lower 33%, middle 33%, and upper 33% income categories. We show that only the change in female durable buying attitudes accurately predicts the sign of growth in durables spending.

KEYWORDS:

• Durable goods
• attitudinal data
• gender
• symmetric loss

JEL CLASSIFICATION:

• C14
• E21

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

¹ Baghestani (2013) evaluates the accuracy of the Federal Reserve forecasts of growth in consumption and its components.

² The MSE data for month t are generally released before the end of month t to the fee-paying Thompson-Reuters subscribers.