Flexible (S,s) Bands, Uncertainty, and Aggregate Consumer Durables
AbstractRecent work in macroeconomics has suggested that (S,s) rules are a useful characterization of household purchases of durable goods, and that they provide a basis for expenditure dynamics consistent with those observed in aggregate data. The purpose of this paper is to determine whether a flexible (S,s) rule, that is, an inaction range that varies over time, provides a more complete characterization of the aggregate data. The results suggest that not only does a flexible rule bring additional explanatory power, but the manner in which the rule implicitly changes over time is highly cyclical and correlated with changes in financial volatility over the business cycle. These results provide an economic structure for the observations that durables purchases contract when consumer uncertainty increases.
Download InfoTo our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Bibliographic InfoPaper provided by Wharton School Rodney L. White Center for Financial Research in its series Rodney L. White Center for Financial Research Working Papers with number 7-92.
Date of creation:
Date of revision:
Contact details of provider:
Postal: 3254 Steinberg Hall-Dietrich Hall, Philadelphia, PA 19104-6367
Phone: (215) 898-7616
Fax: (215) 573-8084
Web page: http://finance.wharton.upenn.edu/~rlwctr/
More information through EDIRC
Other versions of this item:
- Janice C. Eberly, . "Flexible (S,s) Bands, Uncertainty, and Aggregate Consumer Durables," Rodney L. White Center for Financial Research Working Papers 07-92, Wharton School Rodney L. White Center for Financial Research.
You can help add them by filling out this form.
reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Thomas Krichel).
If references are entirely missing, you can add them using this form.