I would like to ask is there anyone could suggest to me some economic theories and econometric models for aggregate consumption or specifically consumption pattern?
Keynes in his General Theory postulated that aggregate consumption is a function of aggregate current disposal income. The relation between consumption and income is based on his fundamental psychological law of consumption which states that when income increases consumption expenditure also increases but by a smaller amount.
The Keynesian consumption function is written as
C = a + cY a > 0 0 < c < 1
Where a is the intercept, a constant which measures consumption at a zero level of disposal income, c is the marginal propensity to consume MPC and Y is the disposal income.