The Review of Economics and Statistics Vol. 57 No. 2 1975
Windfalls and Consumption Under a Borrowing Constraint
Abstract
The emphasis here is on a micro-economic derivation of the theoretical propensity to consume windfalls under limited borrowing capacity. This is done in the next section by means of a comparative static analysis employing a reduced intertemporal utility function. The final section reports a test whose results conform to the prediction of the analysis that the propensity to consume windfalls is negatively related to size of the windfall.
- DOI
- 10.2307/1923999
- Volume
- 57
- Issue
- 2
- Pages
- 180
- Sources
- openalex crossref