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Sums and Products of Indirect Utility Functions

There are relatively few known demand systems that are theoretically satisfactory and practically implementable. This paper investigates building more complex demand systems from simpler known ones by considering sums and products of basic utility functions, an approach that does not seem to have been exploited previously in the literature. Some of the systems that result are interesting and usefully extend the range of available functions. Even the simpler systems that are not sufficiently flexible for the analysis of real world consumption data may still be useful for applied general equilibrium studies and for theoretical explication. Although some systems, instead of being new, turn out to be rediscoveries of already known ones, the way in which they arise as combinations of simple components is of interest in itself in showing them as sub sets of wider classes.

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Paper provided by National Institute for Regional and Spatial Analysis (NIRSA), NUI Maynooth, Ireland. in its series NIRSA Working Paper Series with number 6.

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Length: 16 pages
Date of creation: Mar 2002
Date of revision:
Handle: RePEc:nir:nirwps:wps06
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  1. Conniffe, D., 2002. "A New System of Consumer Demand Equations," Economics, Finance and Accounting Department Working Paper Series n1140402, Department of Economics, Finance and Accounting, National University of Ireland - Maynooth.
  2. Prof. Denis Conniffe, 2002. "A New System of Consumer Demand Equations," NIRSA Working Paper Series 4, National Institute for Regional and Spatial Analysis (NIRSA), NUI Maynooth, Ireland..
  3. Datta, Bipasa & Dixon, Huw, 2000. "Linear-homothetic preferences," Economics Letters, Elsevier, vol. 69(1), pages 55-61, October.
  4. Dixit, Avinash K & Stiglitz, Joseph E, 1975. "Monopolistic Competition and Optimum Product Diversity," The Warwick Economics Research Paper Series (TWERPS) 64, University of Warwick, Department of Economics.
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