On the distributional effects of income in an aggregate consumption relationManisha Chakrabarty, Anke Schmalenbach and Jeffrey Scott Racine () Canadian Journal of Economics, 2006, vol. 39, issue 4, pages 1221-1243 Abstract: In this paper we analyse the influence of characteristics of the income distribution in modelling aggregate consumption expenditure. We model the aggregate consumption relation of a heterogeneous population, using a statistical distributional approach of aggregation, and apply it to UK-Family Expenditure Survey data. A bootstrap test based on a non-parametric estimation methodology, which accounts for the presence of continuous and discrete variables, suggests that the mean and the dispersion of the income distribution significantly influence aggregate consumption expenditure. Also, the parameters of the aggregate relation are time varying. These findings have implications for constructing empirically sound models of aggregate consumption expenditure. JEL-codes: C12 D12 (search for similar items in EconPapers) Downloads: (external link) Related works: Ordering information: This journal article can be ordered from Access Statistics for this article Canadian Journal of Economics is edited by Dwayne Benjamin More articles in Canadian Journal of Economics from Canadian Economics Association |
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