Habit persistence

Habit-Persistence is a model by the British economist TM Brown, who assumes that consumers whose disposable income changes are certain lazy behavior. Brown assumed (1952) that consumers orient their consumption habits not only to the disposable income of the current period, but also to the usual consumption level of the previous period.

This is where Brown differs from Keynes' consumption theory. This assumed that macroeconomic consumption largely depends on current income, but not on past or expected future income.

Was the explanation to "Habit persistence"Helpful? Rate now:

Further explanations for the first letter "H"