IDEAS home Printed from https://ideas.repec.org/p/ecm/ausm04/26.html
   My bibliography  Save this paper

Building Gorman's Nest

Author

Listed:
  • Rulon D. Pope
  • Jeffrey T. LaFrance
  • Timothy K. M.Beatty

Abstract

Gorman's class of Engel curve demand models is extended to incomplete demand systems. The Gorman class of aggregable incomplete demand systems admits any transformation of deflated income. A maximum rank of three for the demand equations is a corollary of Slutsky symmetry. Models of incomplete demand systems are developed that nest the rank of the demand system and functional form of the income variables, can be globally restricted to be weakly integrable, can be estimated consistently and efficiently with aggregate market data, and permit inferences on the impacts of policies on consumption and economic welfare for identifiable groups of consumers

Suggested Citation

  • Rulon D. Pope & Jeffrey T. LaFrance & Timothy K. M.Beatty, 2004. "Building Gorman's Nest," Econometric Society 2004 Australasian Meetings 26, Econometric Society.
    • Handle: RePEc:ecm:ausm04:26
    as

    Download full text from publisher

    File URL: http://www.are.berkeley.edu/~lafrance/working%20papers/
    File Function: main text
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Giancarlo Moschini & Karl D. Meilke, 1989. "Modeling the Pattern of Structural Change in U.S. Meat Demand," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 71(2), pages 253-261.
    2. LaFrance, Jeffrey T., 2008. "The structure of US food demand," Journal of Econometrics, Elsevier, vol. 147(2), pages 336-349, December.
    3. Beatty, Timothy & LaFrance, Jeffrey, 2001. "Income Elasticity and Functional Form," CUDARE Working Papers 198689, University of California, Berkeley, Department of Agricultural and Resource Economics.
    4. Giancarlo Moschini, 1995. "Units of Measurement and the Stone Index in Demand System Estimation," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 77(1), pages 63-68.
    5. Jeffrey T. LaFrance & W. Michael Hanemann, 1989. "The Dual Structure of Incomplete Demand Systems," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 71(2), pages 262-274.
    6. Pashardes, Panos, 1993. "Bias in Estimating the Almost Ideal Demand System with the Stone Index Approximation," Economic Journal, Royal Economic Society, vol. 103(419), pages 908-915, July.
    7. Christensen, Laurits R & Jorgenson, Dale W & Lau, Lawrence J, 1975. "Transcendental Logarithmic Utility Functions," American Economic Review, American Economic Association, vol. 65(3), pages 367-383, June.
    8. Adolf Buse, 1998. "Testing Homogeneity in the Linearized Almost Ideal Demand System," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(1), pages 208-220.
    9. Browning, Martin & Meghir, Costas, 1991. "The Effects of Male and Female Labor Supply on Commodity Demands," Econometrica, Econometric Society, vol. 59(4), pages 925-951, July.
    10. Russell, Thomas & Farris, Frank, 1993. "The geometric structure of some systems of demand equations," Journal of Mathematical Economics, Elsevier, vol. 22(4), pages 309-325.
    11. Jerison, Michael, 1993. "Russell on Gorman's Engel curves : A correction," Economics Letters, Elsevier, vol. 43(2), pages 171-175.
    12. Gordon Anderson & Richard Blundell, 1983. "Testing Restrictions in a Flexible Dynamic Demand System: An Application to Consumers' Expenditure in Canada," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 50(3), pages 397-410.
    13. Russell, Thomas, 1983. "On a theorem of Gorman," Economics Letters, Elsevier, vol. 11(3), pages 223-224.
    14. LaFrance, J. T. & Beatty, T. K. M. & Pope, R. D. & Agnew, G. K., 2002. "Information theoretic measures of the income distribution in food demand," Journal of Econometrics, Elsevier, vol. 107(1-2), pages 235-257, March.
    15. LaFrance, Jeffrey T., 2004. "Integrability of the linear approximate almost ideal demand system," Economics Letters, Elsevier, vol. 84(3), pages 297-303, September.
    16. Howe, Howard & Pollak, Robert A & Wales, Terence J, 1979. "Theory and Time Series Estimation of the Quadratic Expenditure System," Econometrica, Econometric Society, vol. 47(5), pages 1231-1247, September.
    17. Deaton, Angus S & Muellbauer, John, 1980. "An Almost Ideal Demand System," American Economic Review, American Economic Association, vol. 70(3), pages 312-326, June.
    18. Lewbel, Arthur, 1987. "Characterizing Some Gorman Engel Curves," Econometrica, Econometric Society, vol. 55(6), pages 1451-1459, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Hayley H. Chouinard & David E. Davis & Jeffrey T. LaFrance & Jeffrey M. Perloff, 2010. "Milk Marketing Order Winners and Losers," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 32(1), pages 59-76.
    2. Jeffrey LaFrance & Rulon Pope, 2008. "The Generalized Quadratic Expenditure System," Working Papers 2008-27, School of Economic Sciences, Washington State University.
    3. LaFrance, Jeffrey T., 2008. "The structure of US food demand," Journal of Econometrics, Elsevier, vol. 147(2), pages 336-349, December.
    4. Eldon V. Ball & Ricardo Cavazos & Jeffrey T. LaFrance & Rulon Pope & Jesse Tack, 2010. "Aggregation and Arbitrage in Joint Production," Monash Economics Working Papers archive-22, Monash University, Department of Economics.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. LaFrance, Jeffrey T., 2008. "The structure of US food demand," Journal of Econometrics, Elsevier, vol. 147(2), pages 336-349, December.
    2. LaFrance, Jeffrey T., 2004. "Integrability of the linear approximate almost ideal demand system," Economics Letters, Elsevier, vol. 84(3), pages 297-303, September.
    3. LaFrance, J. T. & Beatty, T. K. M. & Pope, R. D. & Agnew, G. K., 2002. "Information theoretic measures of the income distribution in food demand," Journal of Econometrics, Elsevier, vol. 107(1-2), pages 235-257, March.
    4. Jeffrey LaFrance & Rulon Pope & Jesse Tack, 2011. "Risk Response in Agriculture," NBER Chapters, in: The Intended and Unintended Effects of US Agricultural and Biotechnology Policies, pages 143-186, National Bureau of Economic Research, Inc.
    5. Eldon V. Ball & Ricardo Cavazos & Jeffrey T. LaFrance & Rulon Pope & Jesse Tack, 2010. "Aggregation and Arbitrage in Joint Production," Monash Economics Working Papers archive-22, Monash University, Department of Economics.
    6. Jesse Tack & Rulon Pope & Jeffrey LaFrance & Timothy Graciano & Scott Colby, 2012. "Intertemporal Risk Management in Agriculture," Monash Economics Working Papers 16-12, Monash University, Department of Economics.
    7. LaFrance, Jeffrey T & Pope, Rulon D., 2006. "Full Rank Rational Demand Systems," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt8qx7n6p9, Department of Agricultural & Resource Economics, UC Berkeley.
    8. LaFrance, Jeffrey T. & Beatty, Timothy K.M. & Pope, Rulon D., 2005. "Aggregation Theory for Incomplete Systems," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt0z13s7js, Department of Agricultural & Resource Economics, UC Berkeley.
    9. Holt, Matthew T. & Goodwin, Barry K., 2009. "The Almost Ideal and Translog Demand Systems," MPRA Paper 15092, University Library of Munich, Germany.
    10. Jeffrey LaFrance & Rulon Pope, 2008. "The Generalized Quadratic Expenditure System," Working Papers 2008-27, School of Economic Sciences, Washington State University.
    11. Jeffrey T. LaFrance & Rulon D. Pope, 2008. "Homogeneity and Supply," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 90(3), pages 606-612.
    12. Simona Bigerna & Carlo Andrea Bollino & Maria Chiara D’Errico, 2020. "A general expenditure system for estimation of consumer demand functions," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 37(3), pages 1071-1088, October.
    13. Sulgham, Anil K. & Zapata, Hector O., 2006. "A Dynamic Approach to Estimate Theoretically Consistent US Meat Demand System," 2006 Annual Meeting, February 5-8, 2006, Orlando, Florida 35441, Southern Agricultural Economics Association.
    14. Chia-Lin Chang & Thanchanok Khamkaew & Michael McAleer, 2010. "Estimating Price Effects in an Almost Ideal Demand Model of Outbound Thai Tourism to East Asia," Working Papers in Economics 10/11, University of Canterbury, Department of Economics and Finance.
    15. Metin Cakir & Joseph V. Balagtas, 2010. "Econometric evidence of cross-market effects of generic dairy advertising," Agribusiness, John Wiley & Sons, Ltd., vol. 26(1), pages 83-99.
    16. Douglas Fisher & Adrian R. Fleissig & Apostolos Serletis, 2006. "An Empirical Comparison of Flexible Demand System Functional Forms," World Scientific Book Chapters, in: Money And The Economy, chapter 13, pages 247-277, World Scientific Publishing Co. Pte. Ltd..
    17. William Barnett & Ousmane Seck, 2006. "Rotterdam vs Almost Ideal Models: Will the Best Demand Specification Please Stand Up?," WORKING PAPERS SERIES IN THEORETICAL AND APPLIED ECONOMICS 200605, University of Kansas, Department of Economics.
    18. Denni Tommasi, 2016. "Household Responses to cash Transfers," Working Papers ECARES ECARES 2016-20, ULB -- Universite Libre de Bruxelles.
    19. Biing‐Hwan Lin & Steven T. Yen & Diansheng Dong & David M. Smallwood, 2010. "Economic Incentives For Dietary Improvement Among Food Stamp Recipients," Contemporary Economic Policy, Western Economic Association International, vol. 28(4), pages 524-536, October.
    20. Pablo del Río & Desiderio Romero & Marta Jorge & Mercedes Burguillo, 2012. "Territorial differences for transport fuel demand in Spain: an econometric study," Chapters, in: Larry Kreiser & Ana Yábar Sterling & Pedro Herrera & Janet E. Milne & Hope Ashiabor (ed.), Green Taxation and Environmental Sustainability, chapter 4, pages 56-68, Edward Elgar Publishing.

    More about this item

    Keywords

    Aggregation; incomplete demand systems; Gorman Engel curves; weak integrability;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ecm:ausm04:26. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Christopher F. Baum (email available below). General contact details of provider: https://edirc.repec.org/data/essssea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.