Consumption, liquidity constraints, uncertainty and temptation: An international comparison

Michael Mcaleer; J.B. Madsen

doi:10.1016/S0167-4870(00)00037-4

Consumption, liquidity constraints, uncertainty and temptation: An international comparison

Michael Mcaleer, J.B. Madsen

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Abstract

Recent empirical research suggests that the rational expectations life-cycle permanent income hypothesis (LC-PIH) breaks down because consumers are liquidity constrained. This paper re-examines the liquidity constraint hypothesis against the uncertainty and the behavioural life-cycle (SLC) hypotheses using macropanel data for 22 OECD countries, The empirical results provide very strong support for the uncertainty and the BLC hypotheses and no support for the liquidity constraint hypothesis. (C) 2001 Elsevier Science B.V. All rights reserved.

Original language	English
Pages (from-to)	61-89
Journal	Journal of Economic Psychology
Volume	22
DOIs	https://doi.org/10.1016/S0167-4870(00)00037-4
Publication status	Published - 2001

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title = "Consumption, liquidity constraints, uncertainty and temptation: An international comparison",

abstract = "Recent empirical research suggests that the rational expectations life-cycle permanent income hypothesis (LC-PIH) breaks down because consumers are liquidity constrained. This paper re-examines the liquidity constraint hypothesis against the uncertainty and the behavioural life-cycle (SLC) hypotheses using macropanel data for 22 OECD countries, The empirical results provide very strong support for the uncertainty and the BLC hypotheses and no support for the liquidity constraint hypothesis. (C) 2001 Elsevier Science B.V. All rights reserved.",

author = "Michael Mcaleer and J.B. Madsen",

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AU - Mcaleer, Michael

AU - Madsen, J.B.

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AB - Recent empirical research suggests that the rational expectations life-cycle permanent income hypothesis (LC-PIH) breaks down because consumers are liquidity constrained. This paper re-examines the liquidity constraint hypothesis against the uncertainty and the behavioural life-cycle (SLC) hypotheses using macropanel data for 22 OECD countries, The empirical results provide very strong support for the uncertainty and the BLC hypotheses and no support for the liquidity constraint hypothesis. (C) 2001 Elsevier Science B.V. All rights reserved.

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DO - 10.1016/S0167-4870(00)00037-4

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VL - 22

SP - 61

EP - 89

JO - Journal of Economic Psychology

JF - Journal of Economic Psychology

ER -

Consumption, liquidity constraints, uncertainty and temptation: An international comparison

Abstract

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