Consumption and Liquidity Constraints: An Empirical Investigation Export

@article{citeulike:1025540, abstract = {Several recent studies have suggested that empirical rejections of the permanent income/life cycle model might be due to the existence of liquidity constraints. This paper tests the permanent income hypothesis against the alternative hypothesis that consumers optimize subject to a well-specified sequence of borrowing constraints. Implications for consumption in the presence of borrowing constraints are derived and then tested using time-series/cross-section data on families from the Panel Study of Income Dynamics. The results generally support the hypothesis that an inability to borrow against future labor income affects the consumption of a significant portion of the population.}, author = {Zeldes, Stephen P.}, citeulike-article-id = {1025540}, citeulike-linkout-0 = {http://www.jstor.org/stable/1831315}, journal = {The Journal of Political Economy}, keywords = {411-2, liquidity}, number = {2}, pages = {305--346}, posted-at = {2007-01-04 22:40:46}, priority = {2}, title = {Consumption and Liquidity Constraints: An Empirical Investigation}, url = {http://www.jstor.org/stable/1831315}, volume = {97}, year = {1989} }

TY - JOUR ID - citeulike:1025540 L3 - citeulike-article-id:1025540 N2 - Several recent studies have suggested that empirical rejections of the permanent income/life cycle model might be due to the existence of liquidity constraints. This paper tests the permanent income hypothesis against the alternative hypothesis that consumers optimize subject to a well-specified sequence of borrowing constraints. Implications for consumption in the presence of borrowing constraints are derived and then tested using time-series/cross-section data on families from the Panel Study of Income Dynamics. The results generally support the hypothesis that an inability to borrow against future labor income affects the consumption of a significant portion of the population. IS - 2 JF - The Journal of Political Economy EP - 346 TI - Consumption and Liquidity Constraints: An Empirical Investigation VL - 97 SP - 305 KW - 411-2 KW - liquidity AU - Zeldes, Stephen PY - 1989/// UR - http://www.jstor.org/stable/1831315 ER -