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BEA consumer expenditure data is divided into three components:(1) durable, (2) non durable, and (3)service expenditures. In this study we examine the relationship between non durable consumer expenditures and consumer discretionary and consumer staples sector price movements. Rational expectations theory suggests that increasing demand for non durable goods increases the sales and earnings of the firms operating in both of the above sectors. In turn, this results in rising sector prices. Using linear and log linear regression we test the hypothesis that the regression coefficients are positive and statistically significant. Quarterly data is used in the study with the time period under analysis, 2004-2014.

Publication Date


Project Designation

Independent Research

Primary Advisor

Trevor C Collier

Primary Advisor's Department

Economics and Finance


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Arts and Humanities | Business | Education | Engineering | Life Sciences | Medicine and Health Sciences | Physical Sciences and Mathematics | Social and Behavioral Sciences

Modeling the relationship between non durable consumer expenditures and stock market prices: An empirical analysis for the period 2004-2014