Economics, Econometrics and Finance
3 years ago

US economy boosted by new insights into consumer spending habits.

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Measuring the US marginal propensity to consume
Samih Antoine Azar

Paper Summary

The US marginal propensity to consume (MPC) was measured in three degrees: immediate, intermediate, and long term. These levels gradually increase from lowest to highest. While the link between actual income and consumption is weak, the Error-Correction Model and bootstrapping show a strong reversal of this evidence.

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