Seasonality in U.S. Consumer Demand

Abstract

This study uses a new body of quarterly, not seasonally adjusted, data to test various hypotheses regarding consumer demand. The almost complete demand system (ACS) was used to test for the various restrictions of economic theory and for the presence of seasonality. Zero-degree homogeneity, Cournot aggregation, and .negativity were, for the most part, accepted. Tests showed that seasonal effects can be modeled by quarterly intercepts and that slope coefficients are homogeneous over seasons. Also, it was demonstrated that although habit plays a significant role, it is not as prominent as past studies have shown.