Heterogeneity and Aggregation
- (pp. 347-391)
AbstractThis survey covers recent solutions to aggregation problems in three application areas, consumer demand analysis, consumption growth and wealth, and labor participation and wages. Each area involves treatment of heterogeneity and nonlinearity at the individual level. Three types of heterogeneity are highlighted: heterogeneity in individual tastes, heterogeneity in income and wealth risks and heterogeneity in market participation. Work in each area is illustrated using results from empirical data. The overall aim is to show how concerns faced by empirical researchers regarding aggregation can be addressed.
CitationBlundell, Richard, and Thomas M. Stoker. 2005. "Heterogeneity and Aggregation." Journal of Economic Literature, 43 (2): 347-391. DOI: 10.1257/0022051054661486
- C43 Index Numbers and Aggregation; Leading indicators
- E00 Macroeconomics and Monetary Economics: General
- E21 Macroeconomics: Consumption; Saving; Wealth
- E24 Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital