Propensity to spending of an average consumer over a brief period

Abstract

Understanding consumption dynamics and its impact on the whole economy and welfare withinthe present economic crisis is not an easy task. Indeed the level of consumer demand fordifferent goods varies with the prices, consumer incomes and demographic factors.Furthermore crisis may trigger different behaviors which result in distortions andamplification effects. In the present work we propose a simple model to quantitativelydescribe the time evolution over a brief period of the amount of money an average consumerdecides to spend, depending on his/her available budget. A simple hydrodynamical analog ofthe model is discussed. Finally, perspectives of this work are briefly outlined.