Empirical Test of Consumer Theory of Brown, Duesenberry, Hantakkr and Taylor, Jackson-Smith, Kuznets and Friedman in Iran

Document Type : Scientific paper

Author

Assistant professor, Department of Economics, Islamic Azad University, Arsanjan Branch

Abstract


Due to the undeniable effect of expenditures on macroeconomic variables, this research has been devoted to the theory of consumption, This research has been conducted to test the hypothesis of consumption, Brown, Dosebury, and Kuznets, Friedman, Huntaker-Taylor, and Jackson-Smith in Iran until the year 1981-2016. In this regard, two methods have been used: ARDL regression (due to the non-existence of some series) and then ht was Tail Dependence between with Clayton joint method. According to the results, the marginal propensity of consumption the Duznbery model is 83%, Friedman's model is 75.4% and the Jackson-Smith pattern is 74.4%. The marginal propensity of consumption shot-run is estimated to be 0.46 in Brown's pattern and 0.42 in the Hunter-Taylor pattern. The effect of past consumption habits on consumption (coefficient or adhesion) is 39%. That means an increase of 100 units in consumption will increase 39 units in the next year's consumption. The final desire to consume wealth is estimated to be between 0.19 and 0.25. Also, there is a Clayton-dependent relationship between data, and given Clayton's low dependence, then with increased revenue, increased consumption, but with lower income, consumption is not significantly reduced

Keywords

References

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Macroeconomics Research Letter
Volume 14, Issue 27
November 2019
Pages 65-88

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History

  • Receive Date: 15 May 2018
  • Revise Date: 27 August 2019
  • Accept Date: 27 November 2019

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