CONSUMER’ EXPECTATIONS INDEX IN BRAZIL:

AN ANALYSIS OF THE PREDICTIVE POWER IN PERIOD BETWEEN 2001 AND 2014

Authors

  • Jorge Eduardo Macedo Simões UFC/CAEN
  • Márcia Jucá Teixeira Diniz PPGE/UFPA
  • Marcelo Bentes Diniz PPGE/UFPA
  • José Nilo de Oliveira Junior MAER/UFC

Keywords:

consumption, Ncei, vector model of error correction

Abstract

Based on popular consumer confidence theory, this article analyzes the predictive power of the National Consumer Expectations Index (Ncei) using consumer spending in Brazil for the period 2001 to 2014. The econometric methodology involves cointegration techniques such as
described by Johansen (1988), vectors autoregressive models (VAR) and error correction (VEC) (Johansen and Juselius, 1990). The results confirmed the central hypothesis that there is a strong positive correlation over time between the evolutions of Ncei and consumer spending. At the same time, they revealed the existence of cointegration ensuring the presence of a stochastic linear link between the trend of stochastic variables moving toward a long-term equilibrium.
Through the Granger causality test it was also found that the final consumption of household “causes” the national consumer expectations index. Thus refuting the first premise of the Fuhrer popular theory (1993). In addition, through the decomposition of the variance was proved the underlying hypothesis that consumer confidence, as measured by Ncei, is able to predict part of consumption that is not explained by traditional macroeconomic variables, since it acts on the consumption and thus on
aggregate demand.

Published

2021-12-21

How to Cite

Simões, J. E. M., Diniz, M. J. T., Diniz, M. B., & de Oliveira Junior, J. N. (2021). CONSUMER’ EXPECTATIONS INDEX IN BRAZIL:: AN ANALYSIS OF THE PREDICTIVE POWER IN PERIOD BETWEEN 2001 AND 2014. Planejamento E Políticas Públicas, (47). Retrieved from //ipea.gov.br/ppp/index.php/PPP/article/view/600