Households Consumption Behavior in Russia: Estimates on Micro Data
19 Pages Posted: 4 Nov 2013 Last revised: 11 Nov 2013
Date Written: August 1, 2013
This paper investigates the household consumption behavior in Russia. The model assumes that household consumption can be described by both the Euler equation and the rule-of-thumb. Using panel data on households (Russian Longitudinal Monitoring Survey – Higher School of Economics [RLMS-HSE]) from 2000 to 2011, we obtain the estimates of the elasticity of intertemporal substitution and show that an essential part of households consume a constant share of their current income and do not solve optimization problem.
Keywords: household consumption, Euler equation, rule-of-thumb, elasticity of intertemporal substitution, RLMS-HSE
JEL Classification: E21, C23
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