Charlie Nourse

Job Market Paper

How Much Does Anticipation Matter for MPCs? Evidence from Seasonal Bonuses and Lottery Wins

With David Cesar Heymann

We study how household consumption responds to income changes that are (i) fully anticipated and recurring, and (ii) entirely unanticipated and one-off. Using bank account records for 250,000 Spanish households, we compare workers who receive contractually fixed seasonal bonuses every June and December with workers paid evenly through the year. MPCs out of these bonuses average 21 percent over three months; they decline with liquidity but exceed 10 percent even for the most liquid and highest-income households. We also estimate MPCs out of lottery winnings in the same panel. These MPCs are 30 percent over three months, and on a sample exposed to both income changes, the MPCs are indistinguishable. Both responses are short-lived, with spending returning to baseline within three to four months. Anticipation therefore matters far less than theory predicts. Standard models cannot match this pattern; a model in which households anchor spending to their inflows can match both MPCs and their dynamics, while generating realistic wealth.