When Do Estimated Demand Systems Automatically Satisfy Adding Up?
(1996) 7th Econometric Society World Congress- Abstract
- Conditions are presented for when estimated demand systems automatically satisfy adding up. It is shown that there exist nonlinear demand systems (such as the Almost Ideal Demand System) where adding up is allowed in the model, but where it is not automatically satisfied for the LS and SUR estimates. In these situations it is possible to test the applicability of the model as regards adding up. The results are applied to a small model for the consumption of food in Sweden, and it is shown that a test of adding up can be useful in a misspecification analysis.
Please use this url to cite or link to this publication:
https://lup.lub.lu.se/record/1387621
- author
- Edgerton, David LU
- organization
- publishing date
- 1996
- type
- Chapter in Book/Report/Conference proceeding
- publication status
- published
- subject
- keywords
- TESTS OF RESTRICTIONS, DEMAND ANALYSIS, ALLOCATION MODELS, ADDING UP
- host publication
- Working Papers, Department of Economics, Lund University
- publisher
- Department of Economics, Lund University
- conference name
- 7th Econometric Society World Congress
- conference dates
- 0001-01-02
- language
- English
- LU publication?
- yes
- id
- 2660107a-0b32-476f-9b21-76fd52b691c5 (old id 1387621)
- alternative location
- http://www.nek.lu.se/nekded/Research/Publications/Adding_Up.pdf
- date added to LUP
- 2016-04-04 11:30:06
- date last changed
- 2018-11-21 21:05:14
@inproceedings{2660107a-0b32-476f-9b21-76fd52b691c5, abstract = {{Conditions are presented for when estimated demand systems automatically satisfy adding up. It is shown that there exist nonlinear demand systems (such as the Almost Ideal Demand System) where adding up is allowed in the model, but where it is not automatically satisfied for the LS and SUR estimates. In these situations it is possible to test the applicability of the model as regards adding up. The results are applied to a small model for the consumption of food in Sweden, and it is shown that a test of adding up can be useful in a misspecification analysis.}}, author = {{Edgerton, David}}, booktitle = {{Working Papers, Department of Economics, Lund University}}, keywords = {{TESTS OF RESTRICTIONS; DEMAND ANALYSIS; ALLOCATION MODELS; ADDING UP}}, language = {{eng}}, publisher = {{Department of Economics, Lund University}}, title = {{When Do Estimated Demand Systems Automatically Satisfy Adding Up?}}, url = {{http://www.nek.lu.se/nekded/Research/Publications/Adding_Up.pdf}}, year = {{1996}}, }