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Title: |
Tests of Nonlinear Consumption Functions: The Case of Korea, Taiwan,
Thailand and India |
| Author: |
Hsieh, Wen-Jen;
Hsing, Yu |
| Author
Affiliation: |
U WI;
Southeastern LA U |
| Source: |
International Economic Journal, Summer 1994, v. 8, no. 2, pp. 71-81 |
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Publication Date: |
Summer 1994 |
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Abstract: |
In this study, the permanent-income
hypothesis and the Keynesian consumption function for four Asian
countries are considered. The MPCs for Korea and Taiwan characterized by
rapid economic growth have been on the decline, whereas the MPCs for
Thailand and India with moderate or low economic growth have been
stable. The decline in MPCs and rise in MPCs, in turn, are expected to
facilitate government debt financing domestically and/or improve trade
balance account. The real interest rate is found to be negative and
significant only for India, suggesting that the government may use
monetary policy to encourage saving. |
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