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Durable Purchases over the Later Life Cycle
Author(s) -
Browning Martin,
Crossley Thomas F.,
Lührmann Melanie
Publication year - 2016
Publication title -
oxford bulletin of economics and statistics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.131
H-Index - 73
eISSN - 1468-0084
pISSN - 0305-9049
DOI - 10.1111/obes.12085
Subject(s) - demographics , consumption (sociology) , economics , patience , consumer demand , overconsumption , durable good , panel data , demographic economics , labour economics , agricultural economics , microeconomics , econometrics , demography , production (economics) , social science , philosophy , theology , sociology
Abstract We investigate life‐cycle patterns of demand for services from household durables using UK panel data. We take careful account of prices, demographics, labour supply and health. Demand for consumer electronics rises with age, while the demand for household appliances is flat. These findings contrast with the well documented decline in non‐durable consumption at older ages, and suggest that studies that estimate the overall discount rate from nondurable consumption may underestimate consumer patience and the savings required to fund retirement. We also find important non‐separabilities between the demand for durables, labour supply and health status.