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Consumption Function (consumption + function)

Distribution by Scientific Domains
Business, Economics, Finance and Accounting83%

Selected Abstracts

CONSUMPTION AND GROWTH FROM A RICARDIAN PERSPECTIVE,

METROECONOMICA, Issue 4 2009
Nazim Kadri Ekinci
ABSTRACT A new way of imposing the Ricardian closure is proposed through a dynamic consumption function along Keynesian lines. The dynamic consumption function relates consumption to current income and to the accumulated stock of consumer durables. In this way the dynamics of consumption and effective demand become dependent on consumer spending on durables. Using the dynamic consumption function within a simplified Harrod,Domar growth framework, it is shown that there is no independent consumption function in the long run as the Ricardian closure implies. The long-run propensity to consume is an equilibrium relation, not a behavioural parameter. [source]

Minimizing the makespan in open-shop scheduling problems with a convex resource consumption function

NAVAL RESEARCH LOGISTICS: AN INTERNATIONAL JOURNAL, Issue 3 2006
Dvir Shabtay
Abstract We consider open-shop scheduling problems where operation-processing times are a convex decreasing function of a common limited nonrenewable resource. The scheduler's objective is to determine the optimal job sequence on each machine and the optimal resource allocation for each operation in order to minimize the makespan. We prove that this problem is NP-hard, but for the special case of the two-machine problem we provide an efficient optimization algorithm. We also provide a fully polynomial approximation scheme for solving the preemptive case. © 2006 Wiley Periodicals, Inc. Naval Research Logistics, 2006 [source]

Progress from forecast failure,the Norwegian consumption function

THE ECONOMETRICS JOURNAL, Issue 1 2002
Øyvind Eitrheim
After a forecast failure, a respecification is usually necessary to account for the data ex post, in which case there is a gain in knowledge as a result of the forecast failure. Using Norwegian consumption as an example, we show that the financial deregulation in the mid-1980s led to forecast failure both for consumption functions (CFs) and Euler equations (EEs). We argue in the paper that such forecast failures would appear to be at odds with an underlying DGP belonging to the class of EEs, a result that also explains why progress took the form of a respecified CF where wealth plays a central role. That model is updated and is shown to have constant parameters despite huge changes in the income to wealth ratio over nine years of new data. [source]

Cointegration, Government Spending and Private Consumption: Evidence from Japan

THE JAPANESE ECONOMIC REVIEW, Issue 2 2004
Tsung-Wu Ho
Assuming a CRRA preference, this paper shows that there is a cointegration restriction implied by the intra-temporal first-order condition in the consumption function. This restriction predicts a cointegrated system of government consumption, private consumption, and their relative price. Our analysis indicates that, first, Johansen's VECM confirms the theoretical prediction that is supported by the data of Japan; moreover, Bierens' (1997) nonparametric estimator severely contradicts with the theoretical model and fits the data poorly; second, Japanese people have increasing willingness to rearrange their consumption over time. Besides, the intratemporal relationship between private and government consumption remains relatively stable over time. [source]

Disaggregate Wealth and Aggregate Consumption: an Investigation of Empirical Relationships for the G7*

OXFORD BULLETIN OF ECONOMICS & STATISTICS, Issue 2 2003
Joseph P. Byrne
To date, studies of wealth effects on consumption have mainly used aggregate wealth definitions on a single-country basis. This study seeks to break new ground by analysing disaggregated financial wealth in consumption functions for G7 countries. Contrary to earlier empirical work, we find that illiquid financial wealth (i.e. securities, pensions and mortgage debt) tends to be a more important long-run determinant of consumption than liquid financial wealth. These results imply potential instability in consumption functions employing aggregate wealth. Our results are robust using SURE; when testing with a nested specification; and when using a linear model. [source]

Progress from forecast failure,the Norwegian consumption function

THE ECONOMETRICS JOURNAL, Issue 1 2002
Øyvind Eitrheim
After a forecast failure, a respecification is usually necessary to account for the data ex post, in which case there is a gain in knowledge as a result of the forecast failure. Using Norwegian consumption as an example, we show that the financial deregulation in the mid-1980s led to forecast failure both for consumption functions (CFs) and Euler equations (EEs). We argue in the paper that such forecast failures would appear to be at odds with an underlying DGP belonging to the class of EEs, a result that also explains why progress took the form of a respecified CF where wealth plays a central role. That model is updated and is shown to have constant parameters despite huge changes in the income to wealth ratio over nine years of new data. [source]