When Are Supply And Demand Determined Recursively Rather Than Simultaneously?
When supply and demand are recursive, with uncorrelated cross-equation errors, least-squares estimation has no simultaneous-equation bias. Supply to a daily fish market is determined by the previous night's catch; hence this would appear to be a good example of a recursive market. Despite this, data from the Fulton fish market are treated in the literature, without adequate explanation, as coming from a market in which price and quantity are determined simultaneously. We provide the missing explanation, and in doing so reveal some issues about simultaneity that deserve better coverage in our textbooks and fuller consideration by applied econometricians.
Volume (Year): 36 (2010)
Issue (Month): 2 (Spring)
|Contact details of provider:|| Web page: http://www.palgrave-journals.com/|
Postal:c/o Dr. Alexandre Olbrecht, The Anisfield School of Business 205, Ramapo College, 505 Ramapo Valley Road, Ramapo, New Jersey 07430, USA
Phone: (201) 684-7346
Web page: https://www.qu.edu/eea/
More information through EDIRC
|Order Information:||Web: http://www.springer.com/economics/journal/41302|