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Consumption function: nondurable and durable goods

Author

Listed:
  • Fábio A. R. Gomes

    (University of São Paulo, Department of Economics, FEA-RP)

Abstract

Modeling the consumption of nondurable and durable goods separately is equivalent to assuming that consumers` resources exclusively finance one category of goods. To overcome this problem, I modelled these decisions jointly. Not by chance, the new consumption functions for nondurable and durable goods depend not only on consumers` resources, but also on the lagged stock of durable goods.

Suggested Citation

  • Fábio A. R. Gomes, 2022. "Consumption function: nondurable and durable goods," Economics Bulletin, AccessEcon, vol. 42(2), pages 965-970.
    • Handle: RePEc:ebl:ecbull:eb-21-00228
    as

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    File URL: http://www.accessecon.com/Pubs/EB/2022/Volume42/EB-22-V42-I2-P82.pdf
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Consumption function; nondurable goods; durable goods; consumption persistence;
    All these keywords.

    JEL classification:

    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • D1 - Microeconomics - - Household Behavior

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