A System of Demand Equations Satisfying Effectively Global Regularity Conditions
- 1 May 1996
- journal article
- conference paper
- Published by JSTOR in The Review of Economics and Statistics
- Vol. 78 (2) , 359-364
- https://doi.org/10.2307/2109941
Abstract
A parametric specification of an indirect utility function in terms of expenditure and two unit cost functions is proposed. Specification of these unit cost functions in terms of regular functions leads to the notion of an ''effectively globally regular'' system of demand equations; that is, a system of demand equations that is regular over a cone in expenditure-price space, and for which the regular region includes all points in any given sample, and all values of nominal expenditure and prices generating higher values of real expenditure than the sample minimum. This general model nests a number of popular demand systems, such as the Linear Expenditure System, as special cases. An empirical application illustrates some of these ideas.This publication has 3 references indexed in Scilit:
- An Empirically Oriented Demand System with Improved Regularity PropertiesCanadian Journal of Economics/Revue canadienne d'économique, 1992
- Flexible Functional Forms and Global Curvature ConditionsEconometrica, 1987
- An Elasticity can be Estimated Consistently without a Priori Knowledge of Functional FormEconometrica, 1983