IDEAS home Printed from https://ideas.repec.org/a/tpr/restat/v73y1991i4p643-53.html
   My bibliography  Save this article

Disequilibrium, Buffer Stocks and Consumers' Expenditure on Non-durables

Author

Listed:
  • Cuthbertson, Keith
  • Barlow, David

Abstract

The authors examine the importance of a disequilibrium real balance effect on non-durable consumers' expenditure in the U.K. Using cointegration techniques and the Johansen procedure they first establish a desired long-run demand function for liquid assets depending on income, wealth and a set of interest rates. Deviations of liquidity from this desired level cause changes in consumption via intertemporal substitution but via its effect on disequilibrium liquidity. Consumption is modeled in an error-correction framework and is also found to depend on income and financial wealth. Both the disequilibrium liquidity and wealth terms may be picking up the effects of financial liberalization (e.g. "mortgage leak") on consumption as funds released will be temporarily held in financial assets. They also find some evidence that changes in the distribution of income have an independent effect on aggregate consumption. Copyright 1991 by MIT Press.

Suggested Citation

  • Cuthbertson, Keith & Barlow, David, 1991. "Disequilibrium, Buffer Stocks and Consumers' Expenditure on Non-durables," The Review of Economics and Statistics, MIT Press, vol. 73(4), pages 643-653, November.
    • Handle: RePEc:tpr:restat:v:73:y:1991:i:4:p:643-53
    as

    Download full text from publisher

    File URL: http://links.jstor.org/sici?sici=0034-6535%28199111%2973%3A4%3C643%3ADBSACE%3E2.0.CO%3B2-M&origin=bc
    File Function: full text
    Download Restriction: Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Tilfani, Oussama & Kristoufek, Ladislav & Ferreira, Paulo & El Boukfaoui, My Youssef, 2022. "Heterogeneity in economic relationships: Scale dependence through the multivariate fractal regression," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 588(C).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:tpr:restat:v:73:y:1991:i:4:p:643-53. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Kelly McDougall (email available below). General contact details of provider: https://direct.mit.edu/journals .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.