Permanent Income Hypothesis
Empirical studies and observations exposed the shortcomings of the absolute income hypothesis. It failed to explain the patterns of consumption over a long period of time. It did not consider…
Macroeconomic theory and evidence
Empirical studies and observations exposed the shortcomings of the absolute income hypothesis. It failed to explain the patterns of consumption over a long period of time. It did not consider…
Consumption expenditure plays an important role in determining the gross national product (GNP). Consumption generally contributes the biggest portion of GNP, becoming a decisive factor responsible for the national income…