Hostname: page-component-78c5997874-mlc7c Total loading time: 0 Render date: 2024-11-19T01:17:56.081Z Has data issue: false hasContentIssue false
  • English
  • Français

A NOTE ON IMPOSING LOCAL CURVATURE IN GENERALIZED LEONTIEF MODELS

Published online by Cambridge University Press:  19 March 2007

APOSTOLOS SERLETIS  and
ASGHAR SHAHMORADI
APOSTOLOS SERLETIS
Affiliation:
University of Calgary
ASGHAR SHAHMORADI
Affiliation:
University of Tehran
Get access Rights & Permissions [Opens in a new window]

Abstract

In this paper, we build on Ryan and Wales (1998) and Moschini (1999) and impose curvature conditions locally on the generalized Leontief model, introduced by Diewert (1974). In doing so, we exploit the Hessian matrix of second order derivatives of the reciprocal indirect utility function, unlike Ryan and Wales (1998) and Moschini (1999), who exploit the Slutsky matrix.

Keywords

RegularitySlutsky MatrixNegative Semidefinite
Type
NOTES
Information
Macroeconomic Dynamics , Volume 11 , Issue 2 , April 2007 , pp. 290 - 294
Copyright
© 2007 Cambridge University Press

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Barnett W.A. and Y.W. Lee 1985 The global properties of the minflex laurent, generalized leontief, and translog flexible functional forms. Econometrica 53, 1421– 1437. Reprinted in W.A. Barnett and J. Binner (eds.), Functional Structure and Approximation in Econometrics, pp. 79– 97. Amsterdam: Elsevier.
Christensen L.R., D.W. Jorgenson, and L.J. Lau 1975 Transcendental logarithmic utility functions. American Economic Review 65, 367– 383.Google Scholar
Deaton A. and J.N. Muellbauer 1980 An almost ideal demand system. American Economic Review 70, 312– 326.Google Scholar
Diewert W. Erwin (1974) Applications of duality theory. In M.D. Intriligator and D.A. Kendrick (eds.), Frontiers of Quantitative Economics, Vol. 2, pp. 106– 171. Amsterdam: North-Holland.
Diewert W. Erwin and Terence J. Wales 1987 Flexible functional forms and global curvature conditions. Econometrica 55, 43– 68.Google Scholar
Diewert W. Erwin and Terence J. Wales 1988 Normalized quadratic systems of consumer demand functions. Journal of Business and Economic Statistics 6, 303– 312.Google Scholar
Lau L.J (1978) Testing and imposing monotonicity, convexity, and quasi-convexity constraints. In M. Fuss and D. McFadden (eds.), Production Economics: A Dual Approach to Theory and Applications, Vol. 1, pp. 409– 453. Amsterdam: North-Holland.
Moschini Giancarlo 1999 Imposing local curvature in flexible demand systems. Journal of Business and Economic Statistics 17, 487– 490.Google Scholar
Ryan David L. and Terence J. Wales 1998 A simple method for imposing local curvature in some flexible consumer-demand systems. Journal of Business and Economic Statistics 16, 331– 338.Google Scholar