Keynes contends consumption is a function of disposable income. Franco Modigliani’s life cycle hypothesis postulates that an individual’s or household’s level of consumption depends not just on his current income, but also on his long-term expected earnings. Individuals are assumed to plan life time consumptions based on expected earnings over this period. However, an alternative explanation of consumer behavior is the permanent income hypothesis suggested by Milton Friedman. His contention is that consumption is proportional to permanent income, and that this income is expected average long-term income from both human and non-human wealth. What the permanent Income hypothesis has in common with the life cycle hypothesis is that long-term income is assumed to be the primary determinant of consumption. However, many studies examining the validity of these statements have turned up mixed results.  Molana (1991), Hall and Patterson (1992), Horioka (1997), and Drobny and Hall (1998) found consumption and income not having long-run equilibrium relationship. Davidson et all. (1978), Hall (1978) , Campbell (1987), and Pollock and Lekka (2004) on the other hand found stationarity of consumption-income ratio implying the existence of consumption and income relationship as stipulated by the permanent income hypothesis. In view of the mixed findings, questions still remain to be answered. Does permanent income determine consumption, and if so, does it hold for African countries?