Intertemporal substitution in war and peace: evidence from the United Kingdom, 1830-1990

Article Abstract:

The intertemporal elasticity of public consumption was measured using the Euler-equation methodology. This methodology measures substitution elasticity by calculating a partial first-order situation to a dynamic programming problem. UK economic data from 1830 to 1990 were analyze to determine the impact of public consumption on private consumption. It was discovered that the substitution elasticity was 0.24 while the percentages of private and public consumption in aggregate consumption were 92% and 8%, respectively.

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On the excess sensitivity of consumption to information about income

Article Abstract:

A study, which examined several economic variables such as real, per capita and personal disposable income growth rates, showed rejection to some of the Permanent Income Hypothesis variants' restrictions on excess sensitivity of consumption to information about income. Data from Germany and the US show consistency with the model with borrowing constraints. If a number of households experience binding borrowing constraints, short-run income expectations are expected to influence consumption growth.

Econometrics & Model Building, Analysis, Canada, Germany, France, Econometrics, Business models, Permanent income theory

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Speculative attacks: the roles of intertemporal substitution and the interest elasticity of the demand for money

Article Abstract:

An optimization model is used to evaluate the effects of anticipated speculation and an exchange rate regime collapse. The model involves money demand motivated by transactions technology, implying the reduction of transaction costs via increased money holdings. The results imply that intertemporal elasticity of substitution and money demand interest elasticity determine the effects of speculative attacks.

Models, Prices and rates, Foreign exchange, Foreign exchange rates, Money demand, Elasticity (Economics), Foreign exchange futures

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