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Consumer Surplus Estimates and the Source of Regression Error

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  • Beatty, Timothy K.M.
  • Brozovic, Nicholas
  • Ward, Michael B.

Abstract

Contrary to widely held belief, we show that the source of regression error does not matter when calculating Marshallian surplus. A misspecified demand curve, not the assumed source of regression error, leads to differences in estimates of consumer surplus.

Suggested Citation

  • Beatty, Timothy K.M. & Brozovic, Nicholas & Ward, Michael B., 2005. "Consumer Surplus Estimates and the Source of Regression Error," 2005 Annual meeting, July 24-27, Providence, RI 19477, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea05:19477
    DOI: 10.22004/ag.econ.19477
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    References listed on IDEAS

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    Consumer/Household Economics;

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