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A Neural Network Demand System

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Abstract

We introduce a new type of demand system using a feedforward artificial neural network. The neural network demand system is a flexible system that requires few hypotheses, has no roots in consumer theory but may be used to test it. We use the system to estimate demand elasticities on micro data of household consumption in Canada between 2004 and 2008, and compare the results to those of the quadratic almost ideal demand system

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  • Julien Boelaert, 2013. "A Neural Network Demand System," Documents de travail du Centre d'Economie de la Sorbonne 13081, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    • Handle: RePEc:mse:cesdoc:13081
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    More about this item

    Keywords

    Estimating demand systems; neural networks; flexible forms; Quadratic Almost Ideal Demand System (QUAIDS);
    All these keywords.

    JEL classification:

    • C45 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Neural Networks and Related Topics
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis

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