Consumer preferences and demand systems

Barnett, William A. and Serletis, Apostolos (2008): Consumer preferences and demand systems.

Abstract

This paper is an up-to-date survey of the state-of-the-art in consumer demand modelling. We review and evaluate advances in a number of related areas, including different approaches to empirical demand analysis, such as the differential approach, the locally �flexible functional forms approach, the semi-nonparametric approach, and a nonparametric approach. We also address estimation issues, including sampling theoretic and Bayesian estimation methods, and discuss the limitations of the currently common approaches. We also highlight the challenge inherent in achieving economic regularity, for consistency with the assumptions of the underlying neoclassical economic theory, as well as econometric regularity, when variables are nonstationary.

• Item Type: MPRA Paper
• Language: English
• Keywords: Representative consumer; Engel curves; rank; flexible functional forms; parametric tests; nonparametric tests; theoretical regularity
• Subjects: C - Mathematical and Quantitative Methods > C1 - Econometric and Statistical Methods and Methodology: General > C14 - Semiparametric and Nonparametric Methods: General; C - Mathematical and Quantitative Methods > C5 - Econometric Modeling > C50 - 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 > C11 - Bayesian Analysis: General

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