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Unanticipated income and consumption in ASEAN countries

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  • J. Thornton
  • P. Molyneux

Abstract

This note tests the rational expectations-permanent income hypothesis for the six ASEAN countries using the methodology developed by Hall and Flavin. The statistical evidence rejects the hypothesis for each country except Singapore.

Suggested Citation

  • J. Thornton & P. Molyneux, 1996. "Unanticipated income and consumption in ASEAN countries," Applied Economics Letters, Taylor & Francis Journals, vol. 3(4), pages 247-249.
    • Handle: RePEc:taf:apeclt:v:3:y:1996:i:4:p:247-249
    DOI: 10.1080/758520873
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    References listed on IDEAS

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    1. Hall, Robert E, 1978. "Stochastic Implications of the Life Cycle-Permanent Income Hypothesis: Theory and Evidence," Journal of Political Economy, University of Chicago Press, vol. 86(6), pages 971-987, December.
    2. Kiviet, Jan F., 1985. "Model selection test procedures in a single linear equation of a dynamic simultaneous system and their defects in small samples," Journal of Econometrics, Elsevier, vol. 28(3), pages 327-362, June.
    3. Alan S. Blinder & Angus Deaton, 1985. "The Time Series Consumption Function Revisited," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 16(2), pages 465-521.
    4. Godfrey, Leslie G, 1978. "Testing for Higher Order Serial Correlation in Regression Equations When the Regressors Include Lagged Dependent Variables," Econometrica, Econometric Society, vol. 46(6), pages 1303-1310, November.
    5. John F. O. Bilson, 1981. "The Rational Expectations Approach to the Consumption Function: A Multi-country Study," NBER Chapters, in: International Seminar on Macroeconomics 1979, pages 273-299, National Bureau of Economic Research, Inc.
    6. Flavin, Marjorie A, 1981. "The Adjustment of Consumption to Changing Expectations about Future Income," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 974-1009, October.
    7. Engle, Robert F, 1982. "Autoregressive Conditional Heteroscedasticity with Estimates of the Variance of United Kingdom Inflation," Econometrica, Econometric Society, vol. 50(4), pages 987-1007, July.
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