Abstract
Constant elasticity demand functions for individuals must be of unitary elasticity if the integrability conditions arising from the Slutsky matrix are to be preserved. This result imposes constraints on the estimation of demand systems for individuals for whom constant elasticity specifications are assumed. In particular, this result has implications for the use of constant elasticity specifications in the median voter approach to estimating the demand for local public services.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
