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A Theory of Structural Change That Can Fit the Data

Alder, Simon and Boppart, Timo and Mueller, Andreas (2020) 'A Theory of Structural Change That Can Fit the Data.' American Economic Journal: Macroeconomics. ISSN 1945-0443 (In Press)

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Abstract

We study structural change in historical consumption expenditure of theUnited States, the United Kingdom, Canada, and Australia over morethan a century. We characterize the most general class of preferencesin a time-additive setting that admits aggregation of the saving deci-sion and allows to identify preference parameters from aggregate data.We parametrize and estimate such intertemporally aggregable (IA) pref-erences and discuss their properties in a dynamic general equilibriumframework with sustained growth. Our preference class is considerablymore flexible than the Gorman form or PIGL, giving rise to a good fit ofthe non-monotonic pattern of structural change.

Item Type: Article
Divisions: Faculty of Social Sciences > Economics, Department of
Depositing User: Elements
Date Deposited: 04 Dec 2020 09:26
Last Modified: 04 Dec 2020 10:15
URI: http://repository.essex.ac.uk/id/eprint/29270

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