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Estimating A Demand System With Nonnegativity Constraints: Mexican Meat Demand

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  • Amos Golan
  • Jeffrey M. Perloff
  • Edward Z. Shen

Abstract

A new information-based approach for estimating systems of many equations with nonnegativity constraints is presented. This approach, called generalized maximum entropy (GME), is more practical and efficient than traditional maximum-likelihood methods. The GME method is used to estimate an almost ideal demand system for five types of meat using cross-sectional data from Mexico, where most households did not buy at least one type of meat during the survey week. The system of demands is shown to vary across demographic groups. © 2001 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology

Suggested Citation

  • Amos Golan & Jeffrey M. Perloff & Edward Z. Shen, 2001. "Estimating A Demand System With Nonnegativity Constraints: Mexican Meat Demand," The Review of Economics and Statistics, MIT Press, vol. 83(3), pages 541-550, August.
  • Handle: RePEc:tpr:restat:v:83:y:2001:i:3:p:541-550
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    Citations

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    Cited by:

    1. 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.
    2. Davis, Christopher G. & Blayney, Donald P. & Dong, Diansheng & Yen, Steven T. & Johnson, Rachel J., 2011. "Will Changing Demographics Affect U.S. Cheese Demand?," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 43(02), May.
    3. Meurs, Mieke & Slavchevska, Vanya, 2014. "Doing it all: Women’s employment and reproductive work in Tajikistan," Journal of Comparative Economics, Elsevier, vol. 42(3), pages 786-803.
    4. Mikkel Barslund, 2007. "Regional Differences in Food Consumption in Urban Mozambique: A Censored Demand System Approach," Discussion Papers 07-15, University of Copenhagen. Department of Economics.
    5. Fernández, Esteban & Fernández, Paula, 2008. "An extension to Sun's decomposition methodology: The Path Based approach," Energy Economics, Elsevier, vol. 30(3), pages 1020-1036, May.
    6. Laureti, Tiziana & Secondi, Luca & Biggeri, Luigi, 2014. "Measuring the efficiency of teaching activities in Italian universities: An information theoretic approach," Economics of Education Review, Elsevier, vol. 42(C), pages 147-164.
    7. Denton, Frank T. & Mountain, Dean C., 2011. "Exploring the effects of aggregation error in the estimation of consumer demand elasticities," Economic Modelling, Elsevier, vol. 28(4), pages 1747-1755, July.
    8. Malaga, Jaime E. & Pan, Suwen & Duch-Carvallo, Teresa, 2009. "Did Mexican Meat Demand Change under NAFTA?," 2009 Conference, August 16-22, 2009, Beijing, China 51430, International Association of Agricultural Economists.
    9. Millimet, Daniel L. & Tchernis, Rusty, 2008. "Estimating high-dimensional demand systems in the presence of many binding non-negativity constraints," Journal of Econometrics, Elsevier, vol. 147(2), pages 384-395, December.
    10. Fabrizio Balli & Silvia Tiezzi, 2010. "Equivalence scales, the cost of children and household consumption patterns in Italy," Review of Economics of the Household, Springer, vol. 8(4), pages 527-549, December.
    11. Dong, Diansheng & Kaiser, Harry M. & Myrland, Oystein, 2003. "Estimation Of Censored La/Aids Model With Endogenous Unit Values," Research Bulletins 122119, Cornell University, Department of Applied Economics and Management.

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