Intertemporal Consumption and Consumer Demand

Keith McLaren, H. Youn Kim and Russel Cooper

No 152, Econometric Society 2004 Australasian Meetings from Econometric Society

Abstract: This paper integrates two strands of studies on consumer demand and consumption and provides a unified framework for analyzing consumer behavior employing an intertemporal two-stage budgeting procedure. We take a modified AIDS framework for the demand system and derive a general Euler equation by allowing for life-cycle behavior and precautionary saving. We also investigate liquidity constraints and habit formation in consumption behavior. The demand system and the Euler equation constitute a system of recursive equations with cross-equation parameter restrictions. The system is estimated jointly taking explicit account of model-compatible autocorrelation

Keywords: consumer demand; Euler equation; two-stage budgeting (search for similar items in EconPapers)
JEL-codes: D92 E43 G12 (search for similar items in EconPapers)
Date: 2004-08-11
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ecm:ausm04:152

Access Statistics for this paper

More papers in Econometric Society 2004 Australasian Meetings from Econometric Society Contact information at EDIRC.
Bibliographic data for series maintained by Christopher F. Baum (baum@bc.edu).