Use the latest browser recommended by Microsoft
Get speed, security and privacy with Microsoft Edge
Forde (1988) has made an initial attempt to quantify the effect of income and money balances on private consumption and savings decision in Trinidad and Tobago. The aim of this paper is to expand upon such previous work in two ways: i. by testing for the influence of other factors such as changing age structure, terms of trade, export orientation and real interest rates on consumption behaviour; and ii. by allowing consumption to short run movements in its determinants. The paper proceeds as follows. Section 2 looks at the historical behaviour of savings rates and related variables in the Trinidad and Tobago economy over the 1955-87 periods. Section 3 outlines the basic empirical framework and methodology to be adopted. The empirical tests and findings are reported in Section 4. Finally, conclusions are made. (For presentation at the Central Bank of Barbados Research Department Review Seminar, July 12-13)