Estimating and testing intertemporal preferences: A unified framework for consumption, work and savings
Five waves of the Panel Study of Income Dynamics (PSID), 1985-1989 including both wealth supplements, are used to construct an intertemporal budget constraint for selected single headed households. A new functional form of the dual consumer profit function rationalizing consumption, labor supply and savings is specified, estimated and used to test commonly maintained separability hypotheses. Both consumption- labor and time separability are rejected. Cross-price Frisch elasticities are found not to equal zero and this in turns affects all estimates of consumption, labor supply and saving elasticities. This paper contains new results from a previous paper submitted to EconWPA 12/16/03.
|Date of creation:||12 Sep 2004|
|Date of revision:|
|Note:||Type of Document - pdf; pages: 64. PDF file, 64 Pages, 9 Tables, 3 Figures.|
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