Barnett, William A. and Usui, Ikuyasu (2006): The Theoretical Regularity Properties of the Normalized Quadratic Consumer Demand Model.

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Abstract
We conduct a Monte Carlo study of the global regularity properties of the Normalized Quadratic model. We particularly investigate monotonicity violations, as well as the performance of methods of locally and globally imposing curvature. We find that monotonicity violations are especially likely to occur, when elasticities of substitution are greater than unity. We also find that imposing curvature locally produces difficulty in the estimation, smaller regular regions, and the poor elasticity estimates in many cases considered in the paper. Imposition of curvature alone does not assure regularity, and imposing local curvature alone can have very adverse consequences.
Item Type:  MPRA Paper 

Original Title:  The Theoretical Regularity Properties of the Normalized Quadratic Consumer Demand Model 
Language:  English 
Keywords:  Monte Carlo; flexible functional form; production; normalized quadratic; regularity; curvature; monotonicity 
Subjects:  C  Mathematical and Quantitative Methods > C1  Econometric and Statistical Methods and Methodology: General > C13  Estimation: General C  Mathematical and Quantitative Methods > C3  Multiple or Simultaneous Equation Models ; Multiple Variables > C30  General C  Mathematical and Quantitative Methods > C1  Econometric and Statistical Methods and Methodology: General > C12  Hypothesis Testing: General C  Mathematical and Quantitative Methods > C5  Econometric Modeling > C51  Model Construction and Estimation C  Mathematical and Quantitative Methods > C1  Econometric and Statistical Methods and Methodology: General > C10  General 
Item ID:  410 
Depositing User:  William A. Barnett 
Date Deposited:  11. Oct 2006 
Last Modified:  09. Jan 2014 03:01 
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URI:  https://mpra.ub.unimuenchen.de/id/eprint/410 