Latin America and the Caribbean: Exploring Consumption from the Permanent Income Hypothesis

Authors

  • Luis Domingo Laino Guanes Fundación Manuel Gondra, Paraguay

DOI:

https://doi.org/10.14482/f07y3w87

Keywords:

Consumption, Permanent income, Panel data

Abstract

The purpose of this study is to verify the permanent income hypothesis through a consumption function for 14 Latin American and Caribbean countries in the period 2004-2023, using the World Bank’s Development Indicators database. Through the panel data technique, the results do not verify a relationship between consumption and interest rate, both through the fixed effects model and the random effects model. The results, however, verify a relationship between consumption and current income, which is framed within Keynesian theory.

Author Biography

  • Luis Domingo Laino Guanes, Fundación Manuel Gondra, Paraguay

    Luis D. Laino holds a Ph.D. in Economic Sciences from the National University of Asunción, Paraguay. He has a Master’s degree in Economics from American University, Washington, DC, and a Bachelor’s degree in Economics from the Catholic University of Asunción, Paraguay. He has held positions at the Technical Planning Secretariat of Paraguay and has served as a Professor of Economics. He was Paraguay’s Chargé d'Affaires in Portugal and Ambassador to Cuba, Haiti, and the Dominican Republic. Currently, he is a business advisor and researcher at the Chaco American Research Center of the Manuel Gondra Foundation, Paraguay.

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Published

2025-07-02

Issue

No. 35 (2025): N° 35: JAN-JUN 2025

Section

Science article

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