Advanced Search
MyIDEAS: Login

A Karush-Kuhn-Tucker test of convexity for univariate observations

Contents:

Author Info

  • Sofia Georgiadou

    (University of Athens)

  • Ioannis C. Demetriou

    ()
    (University of Athens)

Abstract

The problem of convexity runs deeply in economic theory. For example, increasing returns or upward slopes (convexity) and diminishing returns or downward slopes (concavity) of certain supply, demand, production and utility relations are often assumed in economics. Quite frequently, however, the observations have lost convexity (or concavity) due to errors of the measuring process. We derive the Karush-Kuhn-Tucker test statistic of convexity, when the estimator of the data minimizes the sum of squares of residuals subject to the assumption of non-decreasing returns. It is a highly structured quadratic programming problem that allows a very efficient calculation of the test statistic. Certain applications that test the convexity assumption of real economic data are considered and the interpretation capability of the test is demonstrated. Some numerical results illustrate the computation and present the efficacy of the test in small, medium and large data sets. They suggest that the test is suitable when the number of observations is very large

Download Info

To our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.

Bibliographic Info

Paper provided by Society for Computational Economics in its series Computing in Economics and Finance 2006 with number 435.

as in new window
Length:
Date of creation: 04 Jul 2006
Date of revision:
Handle: RePEc:sce:scecfa:435

Contact details of provider:
Email:
Web page: http://comp-econ.org/
More information through EDIRC

Related research

Keywords: convexity; data fitting; diminishing return; least squares;

Find related papers by JEL classification:

References

No references listed on IDEAS
You can help add them by filling out this form.

Citations

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:sce:scecfa:435. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christopher F. Baum).

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.

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