Estimating demand with distance functions: Parameterization in the primal and dual.
Our purpose is to investigate the ability of different parametric forms to 'correctly' estimate consumer demands based on distance functions using Monte Carlo methods. Our approach combines economic theory, econometrics and quadratic approximation. We begin by deriving parameterizations for transfor...
| Publicado en: | Journal of Econometrics Vol. 147; no. 2; pp. 266 - 275 |
|---|---|
| Autores principales: | , , , |
| Formato: | Artículo |
| Publicado: |
Elsevier Science
December 2008
|
| Materias: | |
| Acceso en línea: | Ver este registro en EBSCOhost |
| fields | @attributes: recordID: 1 pdfLink: plink: https://search.ebscohost.com/login.aspx?direct=true&db=ssf&AN=511429251&site=ehost-live header: @attributes: shortDbName: ssf uiTerm: 511429251 longDbName: Social Sciences Full Text (H.W. Wilson) uiTag: AN controlInfo: bkinfo: jinfo: jid: 03044076 ECM jtl: Journal of Econometrics issn: 03044076 maglogo: N pubinfo: dt: December 2008 vid: 147 iid: 2 pid: 1004 pub: Elsevier Science artinfo: ui: 511429251 10.1016/j.jeconom.2008.09.033 ppf: 266 ppct: 9 formats: tig: atl: Estimating demand with distance functions: Parameterization in the primal and dual. aug: au: Färe, Rolf Grosskopf, Shawna Hayes, Kathy J. Margaritis, Dimitris su: Consumer preferences Mathematical models Monte Carlo method Economic demand sug: subj: Consumer preferences Mathematical models Monte Carlo method Economic demand ab: Our purpose is to investigate the ability of different parametric forms to 'correctly' estimate consumer demands based on distance functions using Monte Carlo methods. Our approach combines economic theory, econometrics and quadratic approximation. We begin by deriving parameterizations for transformed quadratic functions which are linear in parameters and characterized by either homogeneity or which satisfy the translation property. Homogeneity is typical of Shephard distance functions and expenditure functions, whereas translation is characteristic of benefit/shortage or directional distance functions. The functional forms which satisfy these conditions and include both first- and second-order terms are the translog and quadratic forms, respectively. We then derive a primal characterization which is homogeneous and parameterized as translog and a dual model which satisfies the translation property and is specified as quadratic. We assess functional form performance by focusing on empirical violations of the regularity conditions. Our analysis corroborates results from earlier Monte Carlo studies on the production side suggesting that the quadratic form more closely approximates the 'true' technology or in our context consumer preferences than the translog. Copyright (c) 2008 Elsevier B.V. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: N holdings: @attributes: islocal: N |
|---|