Fluctuations In Consumer Durables Expenditure And Fixed Investment of Korea
AbstractThis paper examines time series fluctuations of consumer durables expenditure and Fixed investment. Empirical Studies in the past have typically found that fluctuations in this expenditure series are inconsistent with the standard framework of utility or profit maximization. As a result, the Sources and patterns of the volatility of the series have remained largely unexplained. This paper attempts to provide an alternative description of the series, by exploiting time series implications of the stock adjustment process. A simple stock adjustment identity implies that purchases in durable goods should exhibit strong reversion over time, and that the reversion is the primary source of the volatility in durables expenditure series. Empirical results of the paper support this hypothesis. [E27]
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Bibliographic InfoArticle provided by Taylor & Francis Journals in its journal International Economic Journal.
Volume (Year): 13 (1999)
Issue (Month): 3 ()
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Web page: http://www.tandfonline.com/RIEJ20
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1989_21, Columbia University, Department of Economics.
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"Durable Goods: An Explanation For Their Slow Adjustment,"
1990_49, Columbia University, Department of Economics.
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- Seok-Kyun Hur, 2005. "Money Growth and Interest Rates," NBER Working Papers 11102, National Bureau of Economic Research, Inc.
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