The paper investigates whether there are variants of the permanent income model which are consistent with quarterly, seasonally unadjusted post-war Canadian data. The model estimates about 20 percent of consumers follow the rule of thumb of consuming their current income. This suggests a large...

An empirical puzzle in international finance is the finding of a high correlation between national savings and domestic investment. This result is widely interpreted as evidence of low international capital mobility. This paper examines the long run behaviour of national savings and domestic...