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A Simple Method to Account for Measurement Errors in Revealed Preference Tests

Hjertstrand, Per - Institutet för Näringslivsforskning (IFN) - 2013

Revealed preference tests are widely used in empirical applications of consumer rationality. These are static tests, and consequently, lack ability to handle measurement errors in the data. This paper extends and generalizes existing procedures that account for measurement errors in revealed...

Persistent link: https://www.econbiz.de/10010818424

Generating Random Optimising Choices

Heufer, Jan - Rheinisch-Westfälisches Institut für … - 2012

Generalised Axiom of Revealed Preferences (GARP), that is, they are consistent with utility maximisation. The choices are drawn … from an approximate uniform distribution on the admissible region on each budget which ensures consistency with GARP, based … it can be used to approximate the power of tests for conditions for which GARP is a necessary but not sufficient …

Persistent link: https://www.econbiz.de/10010558559

Heterogenous intertemporal elasticity of substitution and relative risk aversion: estimation of optimal consumption choice with habit formation and measurement errors

Natalia, Khorunzhina; Wayne Roy, Gayle - Volkswirtschaftliche Fakultät, … - 2011

This paper investigates the existence and degree of variation across house holds and over time in the intertemporal elasticity of substitution (IES) and the coefficient of relative risk aversion (RRA) that is generated by habit forming preferences. To do so, we develop a new nonlinear GMM...

Persistent link: https://www.econbiz.de/10009353832

A Monte Carlo Study of the Necessary and Sufficient Conditions for Weak Separability

Hjertstrand, Per - Nationalekonomiska Institutionen, Ekonomihögskolan - 2008

Weak separability is an important concept in many fields of economic theory. This paper uses Monte Carlo experiments to investigate the performance of newly developed nonparametric revealed preference tests for weak separability. A main finding is that the bias of the sequentially implemented...

Persistent link: https://www.econbiz.de/10005645197

Introduction to Price and Productivity Measurement for Housing

Balk, Bert M.; Diewert, Erwin; Nakamura, Alice O. - Vancouver School of Economics - 2009

This paper provides a brief introduction to a proposed new opportunity cost treatment of owner occupied housing in measures of inflation for the United States. In addition, the paper introduces, and provides links to, a collection of nine other papers that discuss various aspects of the...

Persistent link: https://www.econbiz.de/10004975602

Comment on Different Approaches to Index Number Theory

Diewert, Erwin; Hill, Robert J. - Vancouver School of Economics - 2009

Van Veelen and van der Weide (2008) in a recent paper provided some interesting new perspectives on the index number problem. However, the present paper argues that their definitions of a true index and an exact index are different from the standard definitions in the literature. The differences...

Persistent link: https://www.econbiz.de/10004975610

Accounting for Housing in a CPI

Diewert, Erwin; Nakamura, Alice O. - Vancouver School of Economics - 2009

Statistical agencies in different nations usually use the rental equivalence approach to the treatment of housing in their CPIs but a few countries use the user cost approach. The paper argues that an opportunity cost approach is the correct theoretical framework for accounting for OOH in a CPI....

Persistent link: https://www.econbiz.de/10004975622

Exact and Superlative Price and Quantity Indicators

Diewert, Erwin; Mizobuchi, Hideyuki - Vancouver School of Economics - 2009

The traditional economic approach to index number theory is based on a ratio concept. The Konüs true cost of living index is a ratio of cost functions evaluated at the same utility level but with the prices of the current period in the cost function that appears in the numerator and the prices...

Persistent link: https://www.econbiz.de/10004978051

Variabilité spatiale des prix hédoniques des caractéristiques du logement: une nouvelle méthode de calcul des indices de prix spatiaux

Filali, Radhouane - Volkswirtschaftliche Fakultät, … - 2008

Estimation of spatial housing price indices requires a housing market segmentation into local sub-markets. In this paper, we use geographically weighted regression model (GWR) to take account for spatial heterogeneity of housing attribute marginal prices. Estimated marginal prices are then used...

Persistent link: https://www.econbiz.de/10004980399

Best Prices: Price Discrimination and Consumer Substitution

Chevalier, Judith; Kashyap, Anil - National Bureau of Economic Research (NBER) - 2014

We propose a method for constructing price indices when retailers use periodic sales to price-discriminate amongst heterogeneous customers. To do so, we introduce a model in which Loyal customers buy one brand and do not strategically time purchases, while Bargain Hunters always pay the lowest...

Persistent link: https://www.econbiz.de/10011103513