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An Application Of The Income Elasticity Concept To The Demand For Housing, Loyce Bagwell
An Application Of The Income Elasticity Concept To The Demand For Housing, Loyce Bagwell
Masters Theses & Specialist Projects
Many studies approach the housing-income relationship by calculating the income elasticity of demand for housing. This study employs this approach in order to (1) test the implications of the permanent income hypothesis by using data which provide both biased and unbiased elasticity coefficients and (2) test the effects which the explanatory variable, family composition, may have on the elasticity coefficients.
The methodology involves regressing the log of housing expenditure on the log of disposable income for seven different family compositions in order to obtain the income elasticity coefficients. This approach is applied to data (cross section 1960-61 BLS consumer surveys) …