This paper examines the implications of zero expenditures at the micro level for the modeling of aggregate consumer demands. Zero expenditure by an individual consumer on a good is not considered at the budget allocation stage. When such zero expenditures are included in the data the resulting...

This paper focuses on the estimation and testing of equivalence scales in the context of a demand system with nonline ar logarithmic expenditure effects in its budget-share equations. The authors show that such nonlinearity enables one to identify the scal es without demographic separability...