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The Savers-Spenders Theory of Fiscal Policy
Mankiw, N. Gregory - 2000
The macroeconomic analysis of fiscal policy is usually based on one of two canonical models--the Barro-Ramsey model of infinitely-lived families or the Diamond-Samuelson model of overlapping generations. This paper argues that neither model is satisfactory and suggests an alternative. In the...
Persistent link: https://www.econbiz.de/10012471204
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Consumption Over the Life Cycle
Gourinchas, Pierre-Olivier - 1999
This paper employs a synthetic cohort technique and Consumer Expenditure Survey data to construct average age-profiles of consumption and income over the working lives of typical households across different education and occupation groups. Using these profiles, we estimate a structural model of...
Persistent link: https://www.econbiz.de/10012471519
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Household Production and the Excess Sensitivity of Consumption to Current Income
Baxter, Marianne - 1999
Empirical research on the permanent income hypothesis (PIH) has found that consumption growth is excessively sensitive to predictable changes in income. This finding is interpreted as strong evidence against the PIH. We propose an explanation for apparent excess sensitivity that is based on a...
Persistent link: https://www.econbiz.de/10012471755
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The Permanent Income Hypothesis Revisited
Christiano, Lawrence J. - 1987
This paper investigates whether there are simple versions of the permanent income hypothesis which are consistent with the aggregate U.S. consumption and output data. Our analysis is conducted within the confines of a simple dynamic general equilibrium model of aggregate real output, investment,...
Persistent link: https://www.econbiz.de/10012476860
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The Life-Cycle Permanent-Income Model and Consumer Durables
Bar-Ilan, Avner - 1987
are different in some respects from those of standard consumption theory. Specifically, rather than choose an optimal path …) generally produce results that are in line with the predictions of the theory …
Persistent link: https://www.econbiz.de/10012476920
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Seasonal Fluctuations and the Life Cycle-Permanent Income Model of Consumption
Miron, Jeffrey A. - 1986
-Permanent Income model there is no evidence in the aggregate data against the model. The estimates of the parameters of agents' utility …
Persistent link: https://www.econbiz.de/10012477231
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Does Saving Anticipate Declining Labor Income? An Alternative Test of the Permanent Income Hypothesis
Campbell, John Y. - 1986
The permanent income hypothesis implies that people save because they rationally expect their labor income to decline; they save "for a rainy day". It follows that saving should be at least as good a predictor of declines in labor income as any other forecast that can be constructed from publicly...
Persistent link: https://www.econbiz.de/10012477272
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A Reappraisal of Recent Tests of the Permanent Income Hypothesis
Nelson, Charles R. - 1985
utility function. A logrithmic utility function implies a random walk in the log of consumption which is supported by the data … seems to be spread over two quarters. Flavin's (1981) test of the theory is formally equivalent to Hall's except for … tend to rejection of the theory when it is in fact correct. For Hall's data the effect of detrending is to reverse the sign …
Persistent link: https://www.econbiz.de/10012477393
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Life-Cycles in Income and Wealth
Kearl, J. R. - 1983
Using panel data for a sample of households in Utah from 1850 to 1900 we find income and wealth age profiles that are concave and that have a peak within the age distribution of the relevant sample. This finding holds for cross sections at five-year intervals, for pooled cross section...
Persistent link: https://www.econbiz.de/10012477955
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Social Security, Bequests, and the Life Cycle Theory of Saving : Cross-Sectional Tests
Blinder, Alan S. - 1981
tendency to decline with age, in apparent contradiction of the life-cycle theory of saving. However, a broadened concept of …") does decline more or less as predicted by the theory. No matter how they are defined, assets are a decreasing function of … issues econometrically, an equation for assets is developed from the strict life-cycle theory. The specification is …
Persistent link: https://www.econbiz.de/10012478504