Indeed, in recent years, household wealth variables have become increasingly important quantitatively in endeavors to track consumer spending. The importance of household balance sheet variables for explaining consumption and the possibility that not all these variables influence spending identically suggest the need for greater disaggregation than is typically employed in most models.
Observing that, over the past half century, consumer spending has amounted to about 90 percent of income, it might appear that income is largely sufficient to explain consumption. However, econometric evidence suggests that such numbers may be deceptive.