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Identification and Estimation of Equivalence Scales under Weak Separability

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Lewbel, Arthur

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Abstract

This paper shows that most methods of incorporating demographic variation into separable models can be represented in a form that is identical to Barten equivalence scales, except that the scales themselves depend on the exact mix of goods that comprise each group, as well as on demographic variables. This generalization of Barten scales is shown to be more plausible than ordinary scales; can be used to increase the efficiency of demand system estimation; and can overcome J. Muellbauer's underidentification result for cross-sectional estimation of equivalence scales. Copyright 1989 by The Review of Economic Studies Limited.

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Publisher Info
Article provided by Blackwell Publishing in its journal Review of Economic Studies.

Volume (Year): 56 (1989)
Issue (Month): 2 (April)
Pages: 311-16
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Handle: RePEc:bla:restud:v:56:y:1989:i:2:p:311-16

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  1. Liu, Kang E. & Chern, Wen S., 2003. "Food Demand In Urban China: An Application Of A Multi-Stage Censored Demand System," 2003 Annual meeting, July 27-30, Montreal, Canada 21919, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association). [Downloadable!]
  2. C. Federico PERALI & Thomas L. COX, 1995. "Abstract Of Issues In Data Management Of Expenditure Surveys: An Example From The Colombian 1984-85 Urban Survey," Staff Papers 389, University of Wisconsin Madison, AAE. [Downloadable!]
  3. Preston, Ian & Laisney, Francois & Crawford, Ian, 2002. "Estimation of Household Demand Systems with Theoretically Compatible Engel Curves and Unit Value Specifications," ZEW Discussion Papers 97-06 [rev.], ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
    Other versions:
  4. Arthur Lewbel, 2006. "Modeling Heterogeneity," Boston College Working Papers in Economics 650, Boston College Department of Economics. [Downloadable!]
  5. Heckman, James J. & Matzkin, Rosa & Nesheim, Lars, 2009. "Nonparametric Identification and Estimation of Nonadditive Hedonic Models," IZA Discussion Papers 4329, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  6. Martina Menon & Federico Perali & Luca Piccoli, 2008. "The passive drinking effect: Evidence from Italy," PSE Working Papers 2008-33, PSE (Ecole normale supérieure). [Downloadable!]
  7. Vincenzo Atella & Martina Menon & Federico Perali, 2003. "Estimation of Unit Values in Cross Sections without Quantity Information and Implications for Demand and Welfare Analysis," CEIS Research Paper 12, Tor Vergata University, CEIS. [Downloadable!]
  8. C. Federico Perali & THOMAS L. COX, 1995. "Issues in Data Management of Expenditure Surveys: An Example from the Colombian 1984-85 Urban Survey," Wisconsin-Madison Agricultural and Applied Economics Staff Papers 389, Wisconsin-Madison Agricultural and Applied Economics Department. [Downloadable!]
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