Friedman's Zero-Saving Consumption Theory
4 Pages Posted: 25 Jun 2013
Date Written: June 24, 2013
Abstract
This paper proves that Friedman's permanent consumption theory implies zero saving. The consequences are severe: there will be no capital accumulation, no economic growth, but there is unlimited multiplier of wastage.
Keywords: E21, O40
JEL Classification: Saving, Consumption
Suggested Citation: Suggested Citation
Choi, Hak, Friedman's Zero-Saving Consumption Theory (June 24, 2013). Available at SSRN: https://ssrn.com/abstract=2284042 or http://dx.doi.org/10.2139/ssrn.2284042
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