ON THE DURABILITY OF NONDURABLE GOODS - SOME EVIDENCE FROM UNITED-STATES TIME-SERIES DATA

Using both monthly and quarterly data, this paper shows that the durability rates of non-durable goods and services are significantly greater than zero, and in line with the prediction of the theory. The common practice of testing consumption and consumption-related models with the National Income and Product Account category of non-durables and services under the assumption of zero durability may thus be inappropriate.