The three-dimensional global properties of the minflex laurent, generalized leontief, and translog flexible functional forms

This paper is an up-to-date survey of the state-of-the art in consumer demand modelling. We review and evaluate advances in a number of related areas, including di¤erent approaches to empirical demand analysis, such as the di¤erential approach, the locally ‡exible functional forms approach, the semi-nonparametric approach, and a nonparametric approach. We also address estimation issues, including sampling theoretic and Bayesian estimation methods, and discuss the limitations of the currently common approaches. We also highlight the challenge inherent in achieving economic regularity, for consistency with the assumptions of the underlying neoclassical economic theory, as well as econometric regularity, when variables are nonstationary.JEL classi…cation: D12, E21

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“…There are n(n + 5)=2 parameters in (25), but the imposition of the above restrictions reduces the number of parameters to (n 2 + 3n 2)=2.…”

Section: The Normalized Quadratic Expenditure Functionmentioning

confidence: 99%

Consumer preferences and demand systems

Barnett

Serletis

2008

Journal of Econometrics

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128

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“…Failure of the translog function to meet regularity conditions may be due to the inability to include the exceedingly large number of variables simultaneously. However, Barnett, Lee, and Wolfe (1985) and Pollak, Sickles, and Wales (1984) have noted that the translog is not necessarily well behaved. A Cobb-Douglas functional specification is employed for final estimations.…”

Section: Cost Effects Of Regulationmentioning

confidence: 99%

Firm/interruptible gas pricing patterns in a regulated environment

Hollas

1989

J Regul Econ

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“…Checks by Caves and Christensen (1980), , and Barnett, Lee, and Wolfe (1985) indicate regions of the price space in which the translog, generalized Leontief, and minflex Laurent do satisfy these restrictions for various cases. The minflex Laurent appears to outperform the other models in these simulations, tending to satisfy regularity conditions over a wider range of prices.…”

Section: Introductionmentioning

confidence: 96%

A Globally Flexible, Almost Ideal Demand System

Chalfant

1987

Journal of Business & Economic Statistics

126

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The almost ideal demand system is combined with the Fourier expenditure system. Subject to the assumption that preferences are of the price-independent, generalized-logarithmic class, the resulting demand system has the desirable features of each of its components. Aggregate demand equations are consistent with preferences of a representative consumer, and consistent estimates of elasticities are obtained for all observed prices. Application of the new demand system to U.S. consumption of meats and fish reveals that it fits the data well and that the restriction to the usual specification is rejected.

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The three-dimensional global properties of the minflex laurent, generalized leontief, and translog flexible functional forms

Cited by 69 publications

References 18 publications

Consumer preferences and demand systems

Consumer preferences and demand systems

Firm/interruptible gas pricing patterns in a regulated environment

A Globally Flexible, Almost Ideal Demand System

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