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Campbell, John Y. - 1987

For thirty years, it has been accepted that consumption is smooth because permanent income is smoother than measured income. This paper considers the evidence for the contrary position, that permanent income is in fact less smooth than measured income, so that the smoothness of consumption...

Persistent link: https://www.econbiz.de/10012476935

Consumption

Hall, Robert E. - 1987

Macroeconomic research on consumption has been influenced profoundly by rational expectations. First, rational expectations together with the hypothesis of constant expected real interest rates implies that consumption should evolve as a random walk. Much of the research of the past decade has...

Persistent link: https://www.econbiz.de/10012476803

The Marginal Propensity to Consume in Heterogeneous Agent Models

Kaplan, Greg; Violante, Giovanni L. - National Bureau of Economic Research - 2022

What model features and calibration strategies yield a large average marginal propensity to consume (MPC) in heterogeneous agent models? Through a systematic investigation of models with different preferences, dimensions of ex-ante heterogeneity, income processes and asset structure, we show...

Persistent link: https://www.econbiz.de/10013210041

Is Consumption Growth Consistent with Intertemporal Optimization? Evidence from the Consumer Expenditure Survey

Attanasio, Orazio P. - 1994

general treatment jof multiple commodities. We show that aggregation over commodities can be important, both theoretically and …

Persistent link: https://www.econbiz.de/10012474125

Limited Asset Market Participation and the Elasticity of Intertemporal Substitution

Vissing-Jorgensen, Annette - 2002

The paper presents empirical evidence based on the US Consumer Expenditure Survey that accounting for limited asset market participation is important for estimating the elasticity of intertemporal substitution (EIS). Differences in estimates of the EIS between assetholders and non-assetholders...

Persistent link: https://www.econbiz.de/10012469818

Intertemporal Choice and the Cross-Sectional Variance of Marginal Utility

Attanasio, Orazio P. - 1998

The theory of intertemporal choice predicts that the cross-sectional variance of the marginal utility of consumption is equal to its own lag plus a constant and a random component. Using general preference specifications and some assumptions about the nature of the random component, we provide...

Persistent link: https://www.econbiz.de/10012472248

The Retirement-Consumption Puzzle : Anticipated and Actual Declines in Spending at Retirement

Hurd, Michael - 2003

The simple one-good model of life-cycle consumption requires consumption smoothing.' However, British and U.S. households apparently reduce consumption at retirement and the reduction cannot be explained by the life-cycle model. An interpretation is that retirees are surprised by the inadequacy...

Persistent link: https://www.econbiz.de/10012469114

Consumer Durables and Inertial Behavior : Estimation and Aggregation of (S,s) Rules

Attanasio, Orazio P. - 1995

, aggregation issues are considered. First, the paper presents a number of negative results. Then, several simulations aimed at …

Persistent link: https://www.econbiz.de/10012473593

Adjustment Costs, Durables, and Aggregate Consumption

Bernanke, Ben - 1982

Previous tests of the permanent income hypothesis (PIH) have focused on either nondurables or durables expenditures in isolation. This paper studies consumer purchases of nondurables and durables as the outcome of a single optimization problem.It is shown that the presence of adjustment costs of...

Persistent link: https://www.econbiz.de/10012478067

Why Surplus Consumption in the Habit Model May be Less Persistent than You Think

Lynch, Anthony W. - 2011

external-habit model of Campbell and Cochrane (1999) can generate a value premium in both CAPM alpha and expected excess return …In U.S. data, value stocks have higher expected excess returns and higher CAPM alphas than growth stocks. We find the … external-habit model generates a growth premium in expected excess return. However, the micro evidence favors a less persistent …

Persistent link: https://www.econbiz.de/10012461707