@article{ffa49dfc66e7491db2625abb5235417c,
title = "Wealth-varying intertemporal elasticities of substitution: Evidence from panel and aggregate data",
abstract = "This paper constructs and estimates a model of consumer preferences in which the intertemporal elasticity of substitution (IES) of consumption expenditure rises with the level of wealth. The purpose of this paper is to measure the effect that systematic variation in the IES of poor and rich consumers has on the IES of aggregate consumption expenditure. We find economically significant differences in the IES of poor and rich consumers in Indian panel data on the consumption of individual households. We also find economically significant differences in the IES measured in aggregate time series data for the U.S. and India.",
keywords = "Consumption, Necessary goods, Subsistence levels",
author = "Andrew Atkeson and Masao Ogaki",
note = "Funding Information: Corresponding author. This is a revision and extension of part of two papers, 'Engel's Law and Saving' and 'Estimating a Model of Engel's Law, Saving, and Risk-Bearing with Indian Panel and U.S. Time Series Data', by the same authors. We thank an anonymous referee, seminar participants at the Bank of Japan, Georgetown, Harvard, Ohio State, and Princeton Universities, the IMF, the NBER Economic Fluctuations Research Meeting in July 1992, the NBER Summer Institute, the Universities of Chicago, Montreal, Pennsylvania, Rochester, and Virginia for helpful discussions at various stages of this research, Thomas Walker at the ICRISAT for access to their Indian panel data, and Youngjae Lim and Robert Townsend for kindly providing us with the lndian panel data and helpful discussions about the panel data. We gratefully acknowledge financial support by National Science Foundation grant no. SES-9213930.",
year = "1996",
month = dec,
doi = "10.1016/S0304-3932(96)01290-1",
language = "English",
volume = "38",
pages = "507--534",
journal = "Carnegie-Rochester Confer. Series on Public Policy",
issn = "0304-3932",
publisher = "Elsevier",
number = "3",
}