In this paper we take a different modeling approach based on the component driven (CD) model developed in Kuan, Huang, and Tsay~(2003) to test the permanent income hypothesis (PIH), an example of intertemporal choice models. A key feature of this approach is that it explicitly allows for state...

Congress enacted The Americans with Disabilities Act of 1990 over the protests of small business advocates who claimed that the ADA would trigger a wave of bankruptcies. Although the profitability of firms may suffer from the costs of ADA compliance, no systematic evidence is available on the...

This paper develops a monopolistic competition model to study the characteristics of products, such as quality improvement and product diversity (function-specialization and individualization), and the division of labor in production. Different from the ordinary economic model, our utility...

Empirical evidences tell us that in the recent years the expansion period is increased with reduction of the contraction period in the U.S. business cycles. Moreover, the business cycles in the United States also show the trend to be moderated with recent economic growth induced and supported by...

Certain problems in comparative statics, including (but not exclusively) certain problems in consumer theory, cannot be easily addressed by the methods of lattice programming. One reason for this is that there is no order on the choice space which orders choices in a way which conforms with the...

The well-behaved (downward sloping and consistent to the consumer surplus) Marshallian demand function forms a basis of the partial equilibrium analysis both in positive and normative perspectives, since the downward slopness and some other regularity conditions imply that there exists a...

In this paper, we adopt the collective approach to consumer behavior --- which supposes that each household member is characterized by his/her own preferences and the decision process results in Pareto-efficient outcomes --- and assume, in addition, that agents are egoistic and consumption is...

In this paper we consider a model where some consumers act in a boundedly rational way by treating money as non-fungible (Kahneman and Tversky (1979) and (1984), Thaler (1987) and (1990). The budget is broken up into different expenditure groups (cookie-jars). Given the amount of resources...

We show that even under incomplete markets, the equilibrium manifold identifies individual demands everywhere in their domains. For this, we assume conditions of smoothness, interiority and regularity, but avoid implausible observational requirements. It is crucial that there be date-zero...

We provide two, new simple proofs of Afriat's celebrated theorem..