THE TESTING OF HALL’S PERMANENT INCOME HYPOTHESIS: A CASE STUDY OF PAKISTAN
Journal Title: Asian Economic and Financial Review - Year 2012, Vol 2, Issue 4
Abstract
The objective of this study is to test the Hall’s permanent income hypothesis for Pakistan using annual data from 1992 to 2010. The basic model of permanent income hypothesis (PIH) showed the validity of absolute income hypothesis (AIH) while the Campbell and Mankiw (1990) consumption model suggested that the proportion of forward looking consumers in total population is 32 percent and the remaining consumers are backward looking. Therefore in Pakistan, there is larger fluctuation in per capita income and small opportunity for consumption smoothing.
Authors and Affiliations
Khalid Khan| Lecturer, University of Agriculture, Water and Marine Sciences, (LUAWMS), Uthal, Balochistan, Manzoor H Memon Che| Economist, Social Policy and Development Centre (SPDC). Karachi
Keywords
Related Articles
- EP ID EP1797
- DOI -
- Views 574
- Downloads 44
FINANCIALIZATION OF HOUSEHOLD SECTOR IN TURKEY., 2000-2013
In financialization age which is last stage of capitalism, traditional banking governance have changed their role. Banking has become mainly dependent on lending individuals without regulation. Household indebtedness was...
THE IMPACTS OF THE QUALITY OF THE ENVIRONMENT AND NEIGHBOURHOOD AFFLUENCE ON HOUSING PRICES: A THREE - LEVEL HIERARCHICAL LINEAR M ODEL APPROACH
This paper employs a three-level hierarchical linear model (HLM) to examine the impacts that the quality of the environment and neighbourhood affluence have on housing prices. The empirical results suggest that there are...
Cash Management Practices of Small Business Owners in the Cape Coast Metropolitan Area of Ghana
The burden of cash management has become a topical issue in small businesses. To gain information on current practice, this paper examines survey evidence on cash management practices of two hundred and two small busines...
PROSPECT OF E-BANKING IN BANGLADESH: NEW WAY TO MAKE BANKING ELECTRONIC
Being a developing country E-banking opened up tremendous opportunity to the financial sector and economic development of Bangladesh. This paper studies prospects of e-banking in Bangladesh, considering the performance o...
A SIMULTANEOUS-EQUATION MODEL OF SHORT-RUN DETERMINANTS OF THE PKR/USD EXCHANGE RATE
This paper examines the determinants of the exchange rate between the Pakistani rupee (PKR) and the U.S. dollar (USD) based on a simultaneous-equation model consisting of demand for and supply of the U.S. dollar. Empiric...