Contributions to Consumer Demand and Econometrics: Essays in by Ronald Bewley

By Ronald Bewley

Contains essays on shopper call for and econometrics written in honour of Professor Henri Theil. The essays document the result of present pioneering study paintings and canopy a number of themes together with inequality assessments, blending forecasts and dynamic panel info models.

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Additional info for Contributions to Consumer Demand and Econometrics: Essays in Honour of Henri Theil

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A3t = 3t*. 8) Anton P. 9). Otherwise said, 1t* are the prices which induce a consumer to purchase the vector q out of free choice. 4), in the regular case with respect to the quantities given prices and in the inverse case with respect to the prices given quantities. While it may be true that for some commodities the quantities adjust to the prices, it is very much possible that for other commodities the prices adjust to the supplied quantities. Think of quickly perishable goods like fresh fish or fresh vegetables.

48), with the last row and column deleted. l. l. The matrix e. is a lower block-triangular matrix. Its determinant is then given by I-S~:I. Since Sl1 is a negative definite matrix -S~: is a positive definite matrix. 1 = Inl-Sl1l. Let S. 29) with last row and column deleted. Barten and Geyskens (1975) use the Cholesky decomposition S. 59) 44 The Estimation of Mixed Demand Systems where B is a lower triangular matrix with ones on the diagonal and H is a (n - 1) X (n - 1) diagonal matrix with the Cholesky values h1' ...

In the mixed context one would solve for the endogenous prices and the endogenous quantities. The disturbance terms of such 'reduced forms' can be taken to be independent of the right-hand side variables. There is then no problem of inconsistency of estimation due to 'simultaneity'. In the case of the regular and inverse system it is fairly simple to select a parametrization which reflects the constraints implied by the structural formulation in a way which is easy to take into account when estimating the system.

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