IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

Adjustment of Consumers' Durables Stocks: Evidence from Automobile Purchases

  • Janice C. Eberly

Disturbances to aggregate expenditure on consumer durables are much more persistent than predicted by an optimizing representative consumer model. Recent work in macroeconomics has explored this "slowness to adjust" in the context of consumers facing transactions costs when purchasing durable goods. This approach produces infrequent household purchases and requires explicit attention to aggregation of households. This paper considers household behavior directly, using panel data on automobile purchases and finds that about half of the households purchase automobiles subject only to transactions costs. Explicit aggregation shows that the cross-section distribution of households according to their durables stocks is quite similar to that theoretically predicted. Simulated aggregate expenditures using observed household slowness to adjust show persistence of aggregate shocks and response to income growth consistent with the aggregate data.

To 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.

Paper 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 22-91.

as
in new window

Length:
Date of creation:
Date of revision:
Handle: RePEc:fth:pennfi:22-91
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/
Email:


More information through EDIRC

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:fth:pennfi:22-91. See general 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 you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.