Article

Constrained Utility Maximization and Demand System Estimation

Nicholas E. Piggott and Thomas L. Marsh

in The Oxford Handbook of the Economics of Food Consumption and Policy

Published in print September 2011 | ISBN: 9780199569441
Published online November 2012 | | DOI: http://dx.doi.org/10.1093/oxfordhb/9780199569441.013.0002

Series: Oxford Handbooks in Economics

Constrained Utility Maximization and Demand System Estimation

More Like This

Show all results sharing these subjects:

  • Economics
  • Econometric and Statistical Methods and Methodology: General
  • Agricultural, Environmental, and Natural Resource Economics

GO

Preview

This article provides an overview of the literature on consumer and demand system analysis with emphasis on complete food demand systems. It presents theoretical foundations, constrained utility maximization, properties, and general demand restrictions. It discusses dual functions, including the expenditure function, the indirect utility function, and the distance function. The first three dual approaches are standard tools of the applied demand system analyst. Then it introduces the issue of welfare effects and integrability along with separability and aggregation. The article also provides a review of functional forms and covers econometric issues that include estimation, inference and hypothesis testing, specification tests, and other empirical issues. Models of the almost ideal demand and inverse systems as well as some additional hypothesis tests and inferences regarding model performance are estimated and reported.

Keywords: demand system; consumer; utility maximization; expenditure function; econometric issues

Article.  12606 words. 

Subjects: Economics ; Econometric and Statistical Methods and Methodology: General ; Agricultural, Environmental, and Natural Resource Economics

Full text: subscription required

How to subscribeRecommend to my Librarian

Buy this work at Oxford University Press »