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A Study on Consumption Behaviors of Each Generation in Mongolia in Transition Countries

In this research, the money illusion not only has arisen, but it was checked that a time preference rate is not constant. If it is consumed as the younger age group and a rate of time preference changes with generations, it will be thought that 1-dollar value changes with generations. That is, even if the loss of the same amount produces the younger age group and an old age layer, if it is the younger age group, a loss may also feel the loss by a money illusion small. That is, the time preference rate which affects consumption smoothing also affects a money illusion. The difference for every generation of a time preference rate becomes larger than the influence which only consumption smoothing has on people’s economical action. It has a possibility of bringing a big difference to the economical action for every generation. If the preference of a between at the different time changes with generations, the consumer behaviors at a certain time not only differ for every generation, but it will be thought that the reactions to a loss also differ.