Kubota, Kohei; Fukushige, Mototsugu - Graduate School of Economics, Osaka University - 2009
The life cycle/permanent income hypothesis (LCPIH) makes two postulates: people behave with rational expectations, and people do not have self-control problems. If either or both of these postulates do not apply, we cannot obtain a testable implication of the LCPIH. We use Japanese panel data...