Analysis on the Relationship between Consumer Sentiment and Macro-economic Indices by Consumer's Characteristics

This paper presents an empirical analysis on the relationship between consumer sentiment and macroeconomic indices by consumer's characteristics such as age, income and employment type. According to the empirical analysis based on the Consumer Sentiment Index(CSI) of the Bank of Korea and other macro-economic indices, the following study findings are presented. First, individual consumer sentiment depends not only on GDP growth, but also on other macro-economic conditions such as wage, employment, consumer and asset price, and debt burden. Second, the degree of importance of the macro-economic indices on determining individual consumer sentiment varies strongly according to consumers' characteristics. These findings reveal that the gap between consumer sentiment and GDP growth can largely be explained by considering the other macro-economic indices and consumer's characteristics.