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N° 2001- 02 |
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| February |
| Defining Consumption Behavior in a Multi-Country
Model |
Olivier Allais
Loïc Cadiou
Stéphane Dées |
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| This paper presents the consumption function
of Marmotte, the multi-country model of the CEPII-CEPREMAP, and its estimation
for the 17 countries of the model. The consumption function is based on the permanent
income model. We have extended this model to account for the presence of habit
formation and liquidity constraints in the consumption behaviors. The results
obtained give us reasonable values for the consumption function of Marmotte. Differences
across the 17 countries concern only the habit behaviors. However, these differences
are not large enough to imply significant differences in terms of consumption
responses to shocks in the simulations of the model. |
Abstract |
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| Consumption, habit formation, liquidity constraints,
generalized method of moments |
Keywords |
| C33, C51, E21, E44 |
JEL classification |
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