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 non-durable 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 non-separabilities 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.
Journal article details
- DOI
- 10.1111/obes.12085
- Publisher
- Wiley
- JEL
- D12, D91
- Issue
- December 2014
Suggested citation
M, Browning and T, Crossley and M, Lührmann. (2014). 'Durable Purchases over the Later Life Cycle' (2014)
More from IFS
Understand this issue
Spring Budget 2024: What you need to know
7 March 2024
The £600 billion problem awaiting the next government
25 April 2024
Sure Start achieved its aims, then we threw it away
15 April 2024
Policy analysis
Oil and gas make Scotland’s underlying public finances particularly volatile and uncertain
27 March 2024
Living standards since the last election
21 March 2024
Major challenges for education in Wales
21 March 2024
Academic research
Labour market inequality and the changing life cycle profile of male and female wages
15 April 2024
Saving by buying ahead: stockpiling in response to lump-sum payments
2 February 2024
There and back again: women’s marginal commuting costs
2 April 2024