Linder's Hypothesis Revisited: A Study on China and 13 Other Countries in Three Different Income Level Groups from 1981 to 2004

This research paper conducted Linder’s hypothesis on China and 13 other developed and developing countries for period from 1981 to 2004. The 13 countries are divided into three different groups according to their income level. The tests were conducted for each group for both entire period and three sub-periods (1981-1992, 1993-2000 and 2001-2004). From the test we found Linder’s effect for both high and lower middle income group. However there is no clear evidence showing low income group has Linder’s effect.