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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 nondurable 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 nonseparabilities between the demand for durables, labour supply and health status.
Authors
Research Associate University of Copenhagen
Martin is an IFS Research Associate, a Nuffield Senior Research Fellow and a Professor of Economics at the University of Oxford.
Research Fellow Royal Holloway, University of London
Melanie joined the Institute for Fiscal Studies in 2006 as a Research Fellow and she is a Professor at Royal Holloway, University of London.
Research Fellow University of Michigan
Tom is a Research Fellow at IFS, a Research Professor for the Institute for Social Research at the University of Michigan.
Working Paper details
- DOI
- 10.1920/wp.ifs.2012.1213
- Publisher
- Institute for Fiscal Studies
Suggested citation
M, Browning and T, Crossley and M, Lührmann. (2012). Durable purchases over the later life cycle. London: Institute for Fiscal Studies. Available at: https://ifs.org.uk/publications/durable-purchases-over-later-life-cycle (accessed: 18 April 2024).
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