Aggregation with Log-Linear Models
When economic theory suggests a log-linear specification for individual agents, e.g., Cobb-Douglas production, it is common to estimate the same log-linear model with aggregate data, invoking a representative agent assumption and thereby assuming away aggregation errors. This paper gives necessary and sufficient restrictions on the distribution of agents in an economy for log-linear agent models to aggregate into log-linear macro models, and discusses the aggregation bias resulting from violation of these restrictions. Theorems, tests, economic rationales, and empirical results are given. Included are connections to random walks and to cointegration. Analogous results for log-level models are derived.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 59 (1992)
Issue (Month): 3 ()
|Contact details of provider:|| |
When requesting a correction, please mention this item's handle: RePEc:oup:restud:v:59:y:1992:i:3:p:635-642.. 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: (Oxford University Press)or (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.