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Impact of Income on Price and Income Responses in the Differential Demand System

Published online by Cambridge University Press:  26 January 2015

Mark G. Brown
Mark G. Brown*
Affiliation:
Economic and Market Research Department, Florida Department of Citrus, University of Florida, Gainesville, FL
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Abstract

An extension of the Rotterdam model is developed that makes the model's income flexibility and marginal propensities to consume varying coefficients. Frisch's duality relationships that the second partial derivatives of demand with respect to income and prices are independent of the order of differentiation are imposed with the marginal propensities to consume specified as functions of income and price, and the Slutsky coefficients specified as functions of income only. A uniform substitute specification is used to analyze the conditional demands for a group of beverages.

Keywords

demandRotterdam modelvarying parametersC51D12Q11
Type
Articles
Information
Journal of Agricultural and Applied Economics , Volume 40 , Issue 2 , August 2008 , pp. 593 - 608
Copyright
Copyright © Southern Agricultural Economics Association 2008

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