How Does Consumption Affect GDP?

Consumption-led expansions contribute more to aggregate GDP growth than non-consumption-led expansions, as expected: on average 1.6 percentage points vs 1 percentage point for non-consumption-led expansions (Graph 4, left-hand panel). Is consumption bad for the economy? Consumer expenditure accounts for a considerable portion of GDP in the United States. As a result, it is one of […]

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