Measuring Intertemporal Substitution : The Role of Durable Goods.

As pointed out by Hall (1988), intertemporal substitution by consumers is a central element of many modern macroeconomic and international models. We argue that Hall's estimator or the IES is downward biased because the intra-temporal substitution between nondurable consumption goods and durable consumption goods is ignored and because the changes in real interest rates affect user costs of durable goods.

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Year of publication:	1995
Authors:	Ogaki, M ; Reinhart, C-M
Institutions:	University of Rochester - Center for Economic Research (RCER)
Subject:	STATISTICS \| EVALUATION

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Series:	RCER Working Papers.
Type of publication:	Book / Working Paper
Notes:	27 pages
Classification:	C13 - Estimation
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005504048