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Mentioned in 1 episodes
A Theory of the Consumption Function
Book • 1957
Milton Friedman's "A Theory of the Consumption Function" is a landmark work in economics that revolutionized our understanding of consumer spending.
The book introduced the permanent income hypothesis, which posits that consumption is determined by a household's long-run expected income rather than its current income.
This challenged the prevailing Keynesian view that consumption is primarily driven by current disposable income.
The permanent income hypothesis has had a profound impact on macroeconomic modeling and forecasting.
It remains a cornerstone of modern consumption theory and continues to be widely used in economic research.
The book introduced the permanent income hypothesis, which posits that consumption is determined by a household's long-run expected income rather than its current income.
This challenged the prevailing Keynesian view that consumption is primarily driven by current disposable income.
The permanent income hypothesis has had a profound impact on macroeconomic modeling and forecasting.
It remains a cornerstone of modern consumption theory and continues to be widely used in economic research.
