Elasticity of Intertemporal Substitution in Consumption in the Presence of Inertia: Empirical Evidence from a Natural Experiment
利用印度银行立法变更提供的自然实验，估计了跨期消费替代弹性约为2.2，发现家庭存在调整惯性，对利率实际变化敏感但对可预见的未来利率变化无反应。
This paper estimates the elasticity of intertemporal substitution in consumption (σ) by exploiting a natural experiment provided by a change in the Indian banking legislation. The new legislation authorized banks to offer higher interest rates on deposits to citizens above 60 years of age. We find evidence that households exhibit inertia in reoptimization and are sensitive to the timing of the actual change in the interest rate. Households do not respond to the predictable changes in future interest rates induced by the change in the legislation. We incorporate this and estimate the σ to be approximately equal to 2.2. This paper was accepted by Amit Seru, finance.