SFB 303 Discussion Paper No. A-560

Author: Hildenbrand, Werner, and Alois Kneip
Title: Demand Aggregation under Structural Stability
Abstract: The goal of this paper is to model the mean (aggregate) consumption expenditure of a large and heterogeneous population of households. The aggregation process is based on assumptions of how the income distribution and the composition of the population evolves over time (structural stability). It is shown that the change in the aggregate consumption expenditure ratio can be decomposed into an effect of changing income dispersion, an effect of income growth, an effect of price-inflation and an effect of changing composition of the population.
Keywords: aggregate consumption expenditure, aggregation, structural stability, income distribution, distribution of household attributes
JEL-Classification-Number: D11, D31, C43, E10
Creation-Date: Oktober 1997
URL: ../1997/a/bonnsfa560.pdf

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