The stationarity of consumption-income ratios: Evidence from bootstrapping confidence intervals

We study the stationarity of consumption-income ratio (APC) in OECD countries. To that end, we use three different bootstrapping techniques to construct the 90% confidence intervals. The results show that the APC is non-stationary in most of the countries.

► We study the stationarity of consumption-income ratio (APC) in OECD countries. ► We construct confidence intervals (CI) for the sum of the autoregressive coefficients. ► The CIs are robust to the presence of a unit root or a root close to unity. ► We also use different unit root tests. ► Results show that most of the APCs in these countries are not stationary.