Who among the following economists introduced the concept of permanent income as a determinant of consumption function ?
M. Friedman
The permanent income hypothesis was put forward by Milton Friedman in A Theory of the Consumption Function (1957). He argued that consumption depends on permanent (long-run expected average) income, not on current measured income.
Measured income = permanent income + transitory income. Households spend a stable fraction of permanent income, while transitory windfalls or losses are largely saved or dissaved, so consumption is smoother than income.
J. M. Keynes gave the absolute income hypothesis (consumption depends on current absolute income, with MPC less than one).
J. S. Duesenberry developed the relative income hypothesis (demonstration effect and ratchet effect based on past peak income).
J. R. Hicks is known for IS–LM analysis, the trade cycle and demand theory, not for a consumption hypothesis based on permanent income.
Hence, the answer is M. Friedman.
Similar Questions
Arrange the following in descending order according to the extent of expenditure of Union Government in Budget 2023-24.
(i) Central Sector Schemes
(ii) Interest Payments
(iii) States' share of taxes and duties
(iv) Centrally sponsored schemes
What is the point elasticity when price is 12 rupees for the demand function P = 60 – 3q.
Match the following:
List I List II (a) 12th Finance Commission (i) Dr. Vijay Kelkar (b) 13th Finance Commission (ii) Dr. C. Rangarajan (c) 14th Finance Commission (iii) N. K. Singh (d) 15th Finance Commission (iv) Y. V. Reddy Codes : (a) (b) (c) (d)
Why does a firm under perfect competition continue to operate in the long run despite earning only normal/zero profits ?
When the Total Product (TP) is maximum, the Average Product (AP) is _____ and the Marginal Product (MP) is _____ .
What is the short run supply curve of a firm in a perfectly competitive market ?
According to Bergson-Samuelson social welfare function approach, social welfare is maximized when _____ .
In Chamberlin’s alternative approach, why does the excess capacity of a monopolistically competitive firm emerge ?
Which of the following term is more important in welfare economics and in designing government policy ?
To maintain price leadership, a dominant firm must ensure that _____ .
Important Questions from Mixed Topic (MH-SET)
.................... is a client server application that identifies each host on the internet with a unique user-friendly name.
Every OS has a ................ or .......... which primarily resides in the main memory of the computer to perform some of the basic functions of the OS.
(i) Kernel
(ii) Interface
(iii) Nucleus
(iv) Compiler
Codes:
Which of the following are referred to as low level language?
(i) Machine language
(ii) Assembly language
(iii) High level language
(iv) Natural language
Codes:
Match the following:
List I List II (a) New York Public Library (i) Shelv AR (b) Miami University Augmented Research Group (ii) Smart library (c) Oula University Library (iii) Wolf Walk (d) North Carolina State University (iv) Find the future Codes:
Which part of the QR code represents the encoded data?
