Empirical Economics

, Volume 58, Issue 1, pp 257–286 | Cite as

Thick modelling income and wealth effects: a forecast application to euro area private consumption

  • Gabe Jacob de BondtEmail author
  • Arne Gieseck
  • Zivile Zekaite


This study develops a thick modelling tool for real private consumption, with a conditional forecasting application to the euro area. Several equations from thousands of error correction models, always including labour income, non-labour income, financial wealth and non-financial wealth as determinants, are selected from predetermined in-sample and out-of-sample criteria. Our thick model estimates show that income effects differ between labour and non-labour income and that their (relative) importance varies over time. This implies that labour and non-labour income should both be on the radar of policy makers and modellers.


Thick modelling Private consumption Income Wealth 

JEL Classification

C53 D12 E21 E27 


Compliance with ethical standards

Conflict of interest

The authors declare that they have no conflict of interest to disclose.

Human and animal rights

This article does not contain any studies with human participants or animals performed by any of the authors.


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Copyright information

© Springer-Verlag GmbH Germany, part of Springer Nature 2019

Authors and Affiliations

  1. 1.Business Cycle Analysis DivisionEuropean Central BankFrankfurt am MainGermany
  2. 2.Monetary Policy DivisionCentral Bank of IrelandDublinIreland

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