Sorensen, Bent E.; Luengo-Prado, Maria J. - Econometric Society - 2004
We simulate a buffer stock model of consumption at the individual level, aggregate, and estimate regressions on the … aggregated (simulated) data. Regressions of consumption on current (or lagged) disposable labor income—using the simulated …. Finally, we estimate aggregate regressions of consumption on current (or lagged) income, allowing the slope in these …