The aim of this paper is to test the Hall （1978）＇s permanent income hypothesis by the specification proposed by Campbell and Mankiw （1989） and Rao （2005）, and five consumptions function specifications of Ghali ...The aim of this paper is to test the Hall （1978）＇s permanent income hypothesis by the specification proposed by Campbell and Mankiw （1989） and Rao （2005）, and five consumptions function specifications of Ghali and Renaud （1971） for a small-open economy, Turkey. We used three methods to investigate the per capita disposable income elasticity of consumption. These are Ordinary Least Squares, Two Stage Ordinary Least Squares with instrument variable and Non-Linear Least Squares with instrument variable for to estimate the specifications. The results indicate that nearly 90% of the consumers in Turkey use the rule of thumb of current disposable income to determine the current consumption. The estimates for the Ghali and Renaud （1971） specifications are consistent by the Rao （2005） concerning the income elasticity of consumption parameter.展开更多
文摘The aim of this paper is to test the Hall （1978）＇s permanent income hypothesis by the specification proposed by Campbell and Mankiw （1989） and Rao （2005）, and five consumptions function specifications of Ghali and Renaud （1971） for a small-open economy, Turkey. We used three methods to investigate the per capita disposable income elasticity of consumption. These are Ordinary Least Squares, Two Stage Ordinary Least Squares with instrument variable and Non-Linear Least Squares with instrument variable for to estimate the specifications. The results indicate that nearly 90% of the consumers in Turkey use the rule of thumb of current disposable income to determine the current consumption. The estimates for the Ghali and Renaud （1971） specifications are consistent by the Rao （2005） concerning the income elasticity of consumption parameter.
