Nondurable goods increased 2.4 percent, compared with an increase of 0.6 percent.

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Sales of nondurable items like food and clothing fell 5.8% from year-earlier levels in January, while car sales dropped 38% during that period.

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The study found that the average household spent 20% to 40% of its rebate on nondurable goods during the three-month period the money was received.

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The rebates increased consumer spending on nondurable items by about 2.9% in the third quarter of 2001 and 2.1% in the fourth quarter, a significant boost that coincided with the economy's recovery, the authors said.

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Souleles and his colleagues also found that in the three months during which the rebates were received, low-income households spent 63% more of the money on nondurable goods than high-income households did, buying things like food, clothing and health-related items.

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