Relatório Política Fiscal IbMacro BH

FINAL CONCLUSION AND RESULTS PROJECT: Estimation of the Marginal Propensity to Consume (MPC) DATA: 961 households with Income, Consumption, and Gender (head) METHOD: OLS Regression | Stata + R | MLE Distribution Fitting --- MAIN FINDINGS --- 1. ESTIMATED MPC = 0.5934 For every additional ₹1 of income, households spend approximately ₹0.59 on consumption and save the remaining ₹0.41. The estimate is highly statistically significant (t = 37.20, p < 0.001). The 95% confidence interval is [0.562, 0.625], which is narrow, indicating HIGH PRECISION of the estimate. 2. GENDER EFFECT = ₹4,912 (NOT SIGNIFICANT) Male-headed households consume about ₹4,912 more than female-headed households after controlling for income. However, this effect is statistically insignificant (t = 0.83, p = 0.405), consistent with the broader empirical literature which finds gender to be a weak predictor of consumption once income is controlled for. 3. MODEL FIT: R-squared = 0.5917 Income alone explains ~59% of the variation in household consumption, which is strong for cross-sectional microdata. 4. DISTRIBUTION FITTING: Both Log-normal and Gamma were fitted to income via MLE. The Log-normal distribution is preferred based on lower AIC, BIC, KS statistic, and Anderson-Darling statistic. This aligns with Gibrat's Law and the empirical income distribution literature. 5. ALL DIAGNOSTIC TESTS PASSED: - Breusch-Pagan (heteroskedasticity): p = 0.264 -> No heteroskedasticity - Shapiro-Wilk (normality of residuals): p = 0.221 -> Residuals are normal - Ramsey RESET (misspecification): p = 0.604 -> Model is well-specified OLS assumptions are satisfied. Results are reliable and unbiased. 6. LITERATURE COMPARISON: Our MPC of 0.593 is consistent with the empirical range of 0.35-0.90 reported in the literature (Parker et al., 2013; Boehm et al., 2025; Kosar & Melcangi, 2025). It falls within the standard range for households with moderate liquidity constraints. CONCLUSION: The modified Keynesian consumption function fits the data well. Income is the primary and statistically significant driver of consumption. The MPC of ~0.59 implies a fiscal multiplier greater than 1 (1/(1-MPC) ≈ 2.44), suggesting that income-support fiscal policies would have a substantial stimulative effect on aggregate demand in this household sample. Gender plays no significant independent role in consumption once income is accounted for, consistent with prior microeconomic evidence.