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Liquidity Constraints and Intertemporal Consumer Optimization : Theory and Evidence from Durable Goods
Chah, Eun Young; Ramey, Valerie A.; Starr, Ross M. - 2021
borrowing constraints. In a departure from previous models, the theory shows that liquidity constraints imply a distinctive … intertemporal relationship between durable and nondurable good~ consumption. The presence of binding, liquidity constraints are …. When liquidity constraints are binding, the error correction term will have predictive power for the future change in …
Persistent link: https://www.econbiz.de/10013243432
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What Do Aggregate Consumption Euler Equations Say About the Capital Income Tax Burden?
Mulligan, Casey B. - 2011
Aggregate consumption Euler equations fit financial asset return data poorly. But they fit the return on the capital stock well, which leads us to three empirical findings relating to the capital income tax burden. First, capital taxation drives a wedge between consumption growth and the...
Persistent link: https://www.econbiz.de/10013133241
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Policy Effects in Hyperbolic vs. Exponential Models of Consumption and Retirement
Gustman, Alan L. - 2010
This paper constructs a structural retirement model with hyperbolic preferences and uses it to estimate the effect of several potential policy changes. Estimated effects of policies are compared under hyperbolic and standard exponential preferences. Sophisticated hyperbolic discounters may...
Persistent link: https://www.econbiz.de/10013136550
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The Intertemporal Allocation of Consumption : Theory and Evidence
Attanasio, Orazio - 2010
Liquidity constraints and, more generally, imperfections in credit markets, can be extremely important for the … literature on consumption. In the first part of the paper I review the reasons why liquidity constraints are important …. Unfortunately, for several reasons, it is not easy to test for the presence of liquidity constraints. Aggregation issues preclude …
Persistent link: https://www.econbiz.de/10013138850
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Is Consumption Growth Consistent with Intertemporal Optimization? Evidence from the Consumer Expenditure Survey
Attanasio, Orazio - 2010
In this paper we show that some of the predictions of models of consumer intertemporal optimization are not inconsistent with the patterns of non-durable expenditure observed in US household-level data. Our results and our approach are new in several respects. First, we use the only US micro...
Persistent link: https://www.econbiz.de/10013139240
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The Evolution of Brand Preferences : Evidence from Consumer Migration
Bronnenberg, Bart J. - 2010
We study the long-run evolution of brand preferences, using new data on consumers' life histories and purchases of consumer packaged goods. Variation in where consumers have lived in the past allows us to isolate the causal effect of past experiences on current purchases, holding constant...
Persistent link: https://www.econbiz.de/10013139281
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Connected Substitutes and Invertibility of Demand
Berry, Steven - 2011
We consider the invertibility of a nonparametric nonseparable demand system. Invertibility of demand is important in several contexts, including identification of demand, estimation of demand, testing of revealed preference, and economic theory requiring uniqueness of market clearing prices. We...
Persistent link: https://www.econbiz.de/10013122653
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A Theory of the Perturbed Consumer with General Budgets
McFadden, Daniel L. - 2012
We consider demand systems for utility-maximizing consumers facing general budget constraints whose utilities are perturbed by additive linear shifts in marginal utilities. Budgets are required to be compact but are not required to be convex. We define demand generating functions (DGF) whose...
Persistent link: https://www.econbiz.de/10013108254
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The New Science of Pleasure
McFadden, Daniel L. - 2013
Economists since the days of Adam Smith and Jeremy Bentham have traditionally viewed consumers as driven by relentless and consistent pursuit of self-interest, with their choices in the marketplace providing all the measurements needed to reveal their preferences and assess their well-being....
Persistent link: https://www.econbiz.de/10013088687
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Improving the Numerical Performance of Blp Static and Dynamic Discrete Choice Random Coefficients Demand Estimation
Dubé, Jean-Pierre - 2009
The widely-used estimator of Berry, Levinsohn and Pakes (1995) produces estimates of consumer preferences from a discrete-choice demand model with random coefficients, market-level demand shocks and endogenous prices. We derive numerical theory results characterizing the properties of the nested...
Persistent link: https://www.econbiz.de/10013159520