Liquidity effects and precautionary saving in the Czech Republic
AbstractAn aggregate consumption function for the Czech Republic since its transition to market status is estimated. Economic theory and the 'general to specific' methodology are used to guide the choice of dynamic equation. Previous empirical evidence on the consumption function in Eastern Europe focused on the centrally planned period and so faced the 'liquidity overhang' principle. A number of different variants are examined including alternative income variables and the rate of unemployment which would proxy income constrained consumers and precautionary saving. The results indicate that the size of the long-run income elasticity is affected by the inclusion of the unemployment variable which may reflect liquidity constraints and precautionary saving.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Taylor & Francis Journals in its journal Applied Financial Economics.
Volume (Year): 12 (2002)
Issue (Month): 6 ()
Contact details of provider:
Web page: http://www.tandfonline.com/RAFE20
Other versions of this item:
- Bredin, Don & Cuthbertson, Keith, 2001. "Liquidity Effects and Precautionary Saving in The Czech Republic," Research Technical Papers 4/RT/01, Central Bank of Ireland.
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Molana, H, 1991. "The Time Series Consumption Function: Error Correction, Random Walk and the Steady-State," Economic Journal, Royal Economic Society, vol. 101(406), pages 382-403, May.
- Portes, Richard & Santorum, Anita, 1987.
"Money and the consumption goods market in China,"
Journal of Comparative Economics,
Elsevier, vol. 11(3), pages 354-371, September.
- Portes, Richard & Winter, David, 1978. "The Demand for Money and for Consumption Goods in Centrally Planned Economies," The Review of Economics and Statistics, MIT Press, vol. 60(1), pages 8-18, February.
- Boskin, Michael J, 1978. "Taxation, Saving, and the Rate of Interest," Journal of Political Economy, University of Chicago Press, vol. 86(2), pages S3-27, April.
- Peter C.B. Phillips, 1985.
"Time Series Regression with a Unit Root,"
Cowles Foundation Discussion Papers
740R, Cowles Foundation for Research in Economics, Yale University, revised Feb 1986.
- Bean, Charles R, 1985.
"The Estimation of 'Surprise' Models and the 'Surprise' Consumption Function,"
CEPR Discussion Papers
54, C.E.P.R. Discussion Papers.
- Bean, Charles R, 1986. "The Estimation of "Surprise" Models and the "Surprise" Consumption Function," Review of Economic Studies, Wiley Blackwell, vol. 53(4), pages 497-516, August.
- Phillips, P C B, 1991.
"Optimal Inference in Cointegrated Systems,"
Econometric Society, vol. 59(2), pages 283-306, March.
- Corbett, Jenny & Mayer, Colin, 1991.
"Financial Reform in Eastern Europe: Progress with the Wrong Model,"
Oxford Review of Economic Policy,
Oxford University Press, vol. 7(4), pages 57-75, Winter.
- Corbett, Jennifer & Mayer, Colin, 1991. "Financial Reform in Eastern Europe: Progress With the Wrong Model," CEPR Discussion Papers 603, C.E.P.R. Discussion Papers.
- Davidson, James E H, et al, 1978. "Econometric Modelling of the Aggregate Time-Series Relationship between Consumers' Expenditure and Income in the United Kingdom," Economic Journal, Royal Economic Society, vol. 88(352), pages 661-92, December.
- Weitzman, Martin L, 1991. "Price Distortion and Shortage Deformation, or What Happened to the Soap?," American Economic Review, American Economic Association, vol. 81(3), pages 401-14, June.
- Marjorie Flavin, 1985. "Excess Sensitivity of Consumption to Current Income: Liquidity Constraints or Myopia?," Canadian Journal of Economics, Canadian Economics Association, vol. 18(1), pages 117-36, February.
- Bill Martin, 2009. "An Augmented UK Private Expenditure Function," ESRC Centre for Business Research - Working Papers wp384, ESRC Centre for Business Research.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty).
If references are entirely missing, you can add them using this form.