A Study on the Model of Household Consumption Function with Demographic Variables

인구학적 변수가 포함된 가계소비함수모형에 관한 연구

The purpose of this study was to investigate new method to incorporate demographic variables into demand models through modifying the theory in an attempt to capture interactions between individuals within a household. The method which utilizes household equivalence scale was very attractive in the sense that it provide less restrictive implications for the behavior model, and thus, the estimated expenditure elasticities might be more realistic because demographic variables are more elaborately controlled. the household equivalence scaled was developed using Lagrange Interpolation Polynomials. Then the empirical model with household equivalence scale was derived based on the model of Deaton and Muellbauer. For its empirical utilization, Consumer Expenditure survey(CES) conducted by the bureau of Labor Statistics(BLS) was used.