Demand System Estimation
Demand system estimation jointly models how a consumer or population allocates a budget across a complete set of goods, estimating a system of equations — one per good — that relate each good's expenditure share or quantity to all prices and total expenditure. Unlike a single-equation demand curve, a demand system imposes the cross-equation restrictions implied by consumer theory: adding-up (shares sum to the budget), homogeneity (no money illusion), and Slutsky symmetry (consistency of cross-price effects). Classic functional forms include Stone's Linear Expenditure System, the Rotterdam model, and the Almost Ideal Demand System, and the system is estimated with seemingly unrelated regression or full-information methods.
Rekod sumber
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- Stone, R. (1954). Linear expenditure systems and demand analysis: an application to the pattern of British demand. The Economic Journal, 64(255), 511–527. · DOI 10.2307/2227743
- Deaton, A., & Muellbauer, J. (1980). An almost ideal demand system. The American Economic Review, 70(3), 312–326. · URL
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