Durable Purchases over the Later Life Cycle |
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| Authors: | Martin Browning Thomas F Crossley Melanie Lührmann |
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| Institution: | 1. Department of Economics, University of Oxford, Oxford, UK;2. Institute for Fiscal Studies, 7 Ridgmount Street, London, WC1E 7AE, UK;3. Department of Economics, University of Essex, Colchester, UK;4. Department of Economics, Royal Holloway, University of London, Egham, UK |
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| 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. |
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