The relationship between income and consumption after global financial crisis

Abstract

Global financial crisis which began with high default rates on subprime and adjustable rate mortgages, developed in 2007 and became visible after the crash of Lehman Brothers in 2008. Like other financial crises, it caused significant declines in consumer wealth. Although it started in US mortgage and state market, its effects are held all over the world. Generally, rich people have more ways to protect their assets than poor people do. So the negative effects of financial crisis (such as decreasing income) are lower for rich persons. One of the most important questions, which arose after the global financial crisis, asked if the burden of recession is felt by all people in the world or region, equally. The aim of this study is to reveal the effects of financial crisis on Turkish university students with different income levels when Turkish economy is collapsing. So we can learn if income distribution between students is deteriorated or not. To realize this aim, the survey which includes 36 questions are applied to students in a private university vocational school of economics and administrative sciences programmes and in a public university school of EASF economics programme. The survey is analyzed by SPSS 16.00 statistical package programme.