The purpose of this paper is to present full information maximum likelihood estimates of linear expenditure systems (LES) and to test for habit formation, autocorrelation and regularity conditions using the likelihood ratio procedure. Estimators for the model and associated tests are based on annual Canadian data for the years 1957-1972. The results obtained provide a basis for helping to clarify concerns with the appropriateness of the LES and an evaluation of alternative characterizations for persistence in consumption patterns. The linear expenditure system has been used in many empirical demand studies. Stone [18], Parks [13], Yoshihara [22], Pollak and Wales [15], Phlips [14], Powell [16] and Deaton [6] and others have presented estimates of the static and simple habit formation variants of the linear expenditure system. Lluch and Williams [11], MacKinnon [12], and Green, Hassan, and Johnson [8] have provided estimates of the LES assuming autoregressive errors. More recently, Howe, Pollak, and Wales [10] estimated the LES considering simultaneously effects of autocorrelation and habits. In this paper we extend our earlier work on autocorrelation and habit formation by developing results which permit a broader basis for evaluating the implications of persistence in consumption behavior for the LES. The plan of the study is as follows. Section II contains a brief review of the LES includ