Abstract:
The study uses the cointegration and common cycle analysis to test whether
there are short-run and long-run co-movement relationships between incomes
and varies consumption expenditure variables. The analysis aims to
detect the long-run co-movements between income and five types of consumption
variables, which provides supporting evidence for the common
brief that income drives consumption in the long-run. In addition, the analysis
also attempts to detect if there are short-run co-movements between income
and consumption.
