WEALTH, DISPOSABLE INCOME AND CONSUMPTION - Economics

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56 p = relative price of non-durables and services = log [((CON$ – CDUR$)/(CON – CDUR))/PGDP] CON$ = total consumption in current dollars. D20113 CDUR$ = consumption of durables in current dollars. D20114 u = unemployment rate. Statistics Canada, Labour Force Division. (LFSA601/LFSA101)*100
APPENDIX 2: Closed-form solution for the cumulative growth factors This appendix outlines the closed-form solution for the cumulative growth factor Γ from (2.4). Expanding out the expression for Γ we have where Γt = Et[ qt + 1+ qt + 1qt + 2 + qt + 1qt + 2qt + 3+ …] qt + i ⎛1 + xt + i⎞ = ⎜------------------- ⎟ ⎝1+ r ⎠ t + i 57 (A1) (A2) Using Markov approximation due to Tauchen (1986), the VAR for x and r is approximated as a finite-state discrete-valued system. Using grids of Nx and Nr to approximate the continuous-valued series x and r respectively, the state space of the dicrete system is Nx × Nr ≡ N. The dynamics of the system are described by an N × N matrix of transition probabilities Φ with typical element φk, l= prob[state = k state = l] (A3) where denotes “conditional on.” The discrete-valued system can be used to form the discrete variable qˆ that approximates the continuous-valued variable q. Let Q be the Nx × Nr matrix of qˆ’s in the system and define Q as the N × 1 vector obtained by stacking the columns of Q one on top of the other. If we index the elements of Q by k = 1, …, N, the typical element of Q can be written as qˆ( k) . With this investment in notation, the expected geometric averages of qˆ can be computed as follows: E[qˆ t 1 + qˆt= qˆ( k)] = φk, lqˆ() l N ∑ l= 1 (A4)
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November 1994 WEALTH, DISPOSABLE IN
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CONTENTS ACKNOWLEDGMENTS ..........
Page 7 and 8:
ABSTRACT The author develops a meas
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1 INTRODUCTION Empirical research o
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impact of fluctuations in the price
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2 MEASURING WEALTH In a competitive
Page 15 and 16: ∞ 1 + xt + j Ht = Xt 1 + E ⎛ t
Page 17 and 18: 2.3 percentage points) between the
Page 19 and 20: The time-series properties of net i
Page 21 and 22: expectation operator. Instead, the
Page 23 and 24: Table 3 Cumulative growth factors u
Page 25 and 26: 180 000 160 000 140 000 120 000 100
Page 27 and 28: non-residential structures, machine
Page 29 and 30: 80 000 70 000 60 000 50 000 40 000
Page 31 and 32: 3 IS WEALTH USEFUL IN EXPLAINING CO
Page 33 and 34: contrast, appears to be trend-stati
Page 35 and 36: First, there is little evidence tha
Page 37 and 38: Both estimators correct for the end
Page 39 and 40: cointegrating parameters reported i
Page 41 and 42: consumption, disposable income and
Page 43 and 44: Table 8 Error-correction models for
Page 46 and 47: 38 0.5 0.0 -0.5 -1.0 0.8 0.6 0.4 0.
Page 48 and 49: 40 conventional levels. Presumably
Page 50 and 51: 42 0.5 0.0 -0.5 -1.0 0.6 0.4 0.2 0.
Page 53 and 54: 15 000 14 000 13 000 12 000 11 000
Page 55 and 56: 4 CONCLUSION The wealth measure dev
Page 57 and 58: APPENDIX 1: The data This appendix
Page 59 and 60: TAX = taxes net of transfers = (NET
Page 61 and 62: = FINAQ_CD+FINAQ_CC+FINAQ_OBDS + FI
Page 63 and 64: CPPQ = Canada Pension Plan. D162590
Page 65: RAC = average coupon rate = RAC(t-1
Page 69 and 70: APPENDIX 3: Wealth and its componen
Page 71: 87:2 356297.31 295864.21 60433.10 3
Page 74 and 75: 64 Flavin, M. A. 1981. “The Adjus
Page 76 and 77: 66 Perron, P. 1991. “Test Consist
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WEALTH, DISPOSABLE INCOME AND CONSUMPTION - Economics

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