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dc.contributor.authorRoche, Maurice J.
dc.date.accessioned2012-09-07T14:41:10Z
dc.date.available2012-09-07T14:41:10Z
dc.date.issued1995
dc.identifier.citationRoche, Maurice J. 'Testing the permanent income hypothesis: the Irish evidence'. - Economic & Social Review, Vol. 26, No. 3, April, 1995, pp. 283-305, Dublin: Economic & Social Research Instituteen
dc.identifier.issn00129984
dc.identifier.urihttp://hdl.handle.net/2262/64859
dc.description.abstractWe investigate whether the permanent income hypothesis (PIH) is consistent with Irish data and find that it holds for about 50 per cent of consumers. We hypothesise that worsening borrowing conditions lead agents to consume more out of disposable income and this causes the PIH to be refuted empirically. We hypothesise that the economy consists of two types of optimising consumers. One type are creditors who behave in a standard fashion. The other type are borrowers who are liquidity constrained and face a schedule of loan interest rates which are an increasing function of the amount of the loan. Our results confirm our hypothesis and indicate that when borrowing conditions worsen consumption growth becomes more responsive to income and less responsive to interest rates.en
dc.language.isoenen
dc.publisherEconomic & Social Research Instituteen
dc.sourceEconomic & Social Reviewen
dc.subjectPermanent income hypothesisen
dc.subjectConsumer behaviouren
dc.subjectIrelanden
dc.titleTesting the permanent income hypothesis: the Irish evidenceen
dc.typeJournal Articleen
dc.publisher.placeDublinen


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