A Regular demand system with commodity-specific demographic effects

Paul Blacklow, Russel Cooper, Roger Ham, Keith McLaren

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Regular consumer demand systems almost invariably employ specifications that involve common functional forms in all equations. When applications involve cross-sectional data it is often the case that demographic effects are important. However it is plausible that demographic effects are commodity-specific. In this case, there may be a loss of efficiency if a common functional form across commodities is imposed artificially by entering redundant explanators in demand equations for which specific demographic influences are unwarranted. This paper explores an approach to specifying a complete system of demand equations which is fully regular but which nevertheless allows for commodity-specific variation in the functional form of the demand equations.
Original languageEnglish
Title of host publicationProceedings of the 2006 Australasian Meeting of the Econometric Society (ESAM06)
PublisherThe Econometric Society
Number of pages30
Publication statusPublished - 2006
EventEconometric Society Australasian Meeting (2006) - Alice Springs, NT
Duration: 5 Jul 20067 Jul 2006


ConferenceEconometric Society Australasian Meeting (2006)
CityAlice Springs, NT


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