Journal article

Smoothing consumption fluctuations through household decisions on home improvement expenditure in Japan

Y Moriizumi, P Tiwari, N Yukutake

International Journal of Housing Markets and Analysis | Emerald Group Publishing Ltd. | Published : 2014

Abstract

Purpose: The purpose of this paper is to investigate the housing improvement expenditure as a consumption smoothing strategy for Japanese households. Design/methodology/approach: Tobit estimation method is used to empirically investigate the role of home improvement expenditure in smoothing consumption for households in Japan using data from Japan Housing Demand Survey for 2003. Findings: Findings suggest that: households in Japan use home improvement expenditure to adjust fluctuation in income. Income-constrained elderly households reduce their housing consumption by not improving their homes ceteris paribus in order to maintain their consumption levels. The mortgage repayment burden also p..

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