The impact of changes in actual or perceived value of assets on consumption decisions. Changes in wealth that are perceived to be temporary will have a smaller effect on consumption expenditures than changes in wealth that are deemed permanent.
We see this term applied to actions by the central banks like the Fed. They often want to increase the value of markets, especially stocks and real estate, to make people feel "wealthier". This is in alignment with the belief that as people experience this, they will go out and buy goods.
It is all done to increase the impact upon the economy.