Huang, Chao-Hsi; Huang, Yue-Lieh - Econometric Society - 2004
In this paper we take a different modeling approach based on the component driven (CD) model developed in Kuan, Huang, and Tsay~(2003) to test the permanent income hypothesis (PIH), an example of intertemporal choice models. A key feature of this approach is that it explicitly allows for state...