Methodological Innovations in Collecting Spending Data: The HRS Consumption and Activities Mail Survey*

Abstract

It has traditionally been believed that collecting survey measures of total spending necessarily involved asking a large number of questions, too many for inclusion of a comprehensive spending measure in a general-purpose survey. In this paper, we report on a supplemental survey to the Health and Retirement Study that took up this challenge. We discuss issues that arise when designing a survey module to collect spending data with strict time constraints, describe how the implementation in the Consumption and Activities Mail Survey (CAMS) played out, and elicit anomalies that more detailed analysis of data quality revealed. We report how we addressed some of these anomalies in subsequent waves of CAMS. Other anomalies required conducting some randomised experiments to find what explains the observed patterns. The results highlight the tension between asking about spending using a long time frame, which exacerbates recall bias, versus using a short time frame, which risks relying on an unrepresentative snapshot of a household's spending to proxy the total for the last 12 months. An important complicating factor in deciding which goods should be put into which time frames is that there is substantial heterogeneity in the frequency of spending across households even for the same category of spending.

Credit Card Debt and Consumer Payment Choice: What Can We Learn from Credit Bureau Data?

“…Issues may arise due to respondents' poor recall or rounding errors, or because the stigma associated with certain financial information makes respondents reluctant to report it. The statistics literature shows that survey responses are highly sensitive to the questionnaire design (Sudman, Bradburn, and Schwarz 1996;Tourangeau, Rasinski, and Bradburn 1991), and that survey-based statistics are very sensitive to the recall period used in the survey questionnaire (Deaton and Grosh 2000;Hurd and Rohwedder 2009). Also, respondents might not know about other household members' financial information for jointly held accounts, or when bills are paid on behalf of the household by another person.…”

Heterogeneity in spending change at retirement

“…For example, food spending is often reported as weekly spending whereas rent is often reported as monthly spending. Spending is annualized to produce an estimate of total annual spending (Hurd and Rohwedder, 2009). …”

“…Hurd and Rohwedder (2009) discuss the details of various design elements of CAMS and comparisons of the first four waves of CAMS with CEX spending are presented in Hurd and Rohwedder (forthcoming). They find that in the age range 55–64 CAMS spending was 4% higher than CEX spending on average.…”

How Much Does Out-of-Pocket Medical Spending Eat Away at Retirement Income?

“…19 Figure 3 shows that even though the share of total income remaining after OOP costs is larger than the share of OASI income remaining, medical spending takes a large toll on Moreover, the high level of spending on premiums for RHI enrollees may be reported with error. Appendix Figure C shows the analogous results for the CAMS, which prior studies have found to better match other measures of spending more broadly (Hurd and Rohwedder 2008 Figures 5 to 7 show results by these subgroups. Figure 5 shows that for women, the post-OOP OASI ratio is 62 percent, compared with 70 percent for men.…”