Social Foundations of Economic Outlooks: How Race and Social Resources Influence Consumer Expectations and Attitudes

Despite their widespread use, there is debate around the ability of consumer expectation indices to predict consumer behavior. This study assesses the predictive power of such indices by examining the relationship between race, access to social resources, and economic expectations. Using data from the 2013 Survey of Consumer Finances, the findings suggest current components of indices may not sufficiently reflect socio-economic factors related to consumption. Importantly, this paper shows that race impacts national economic expectations, a key underpinning of these indices, in a paradoxical way. Despite lower socioeconomic status, on average, nonwhite respondents are significantly more likely to report optimistic expectations than white respondents. Through this and other findings, I propose that national economic expectations may be conceived of as an abstract concept unrelated to consumption, and instead a reflection of broader cultural frames. To be successful, indices need to better capture respondents’ concrete financial worlds. More broadly, this paper demonstrates the important perspective sociology brings to economic expectations research.