Do borrowing constraints matter?
Subtitle: an analysis of why the permanent income hypothesis does not apply in japan
By: Miki Kohara, Charles Yuji Horioka.
Contributors: Horioka, Charles.; National Bureau of Economic Research.
Series: NBER working paper series -- working paper 12330; Working paper series (National Bureau of Economic Research : Online) -- working paper no. 12330.
Publisher: National Bureau of Economic Research
Published: 2006
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Description: "We use micro data on young married households from the Japanese Panel Survey of Consumers in order to analyze the importance of borrowing constraints in Japan.  We find (1) that 8 to 15 percent of young married Japanese households are borrowing-constrained, (2) that household assets and the husband's educational attainment are the most important determinants of whether or not a household is borrowing-constrained, and (3) that the Euler equation implication is rejected for both the full sample and for the subsample of unconstrained households.  These results suggest that the life cycle/permanent income hypothesis does not apply in Japan and that the presence of borrowing constraints is not the main reason why it does not apply"--National Bureau of Economic Research web site.
Notes: Title from PDF file as viewed on 6/29/2006.

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