Stone-Geary meets CES : the properties of an extended linear expenditure system
Sancho Pifarré, Ferran (Universitat Autònoma de Barcelona. Departament d'Economia i d'Història Econòmica)

Date:	2024
Abstract:	The structure of demand plays a fundamental role in shaping economic equilibrium. In computable general equilibrium analysis, comparative statics allow us to simulate how policies or external adjustments impact the equilibrium state. The results of these simulations are significantly influenced by the nature of the adopted demand structure. Typically, homothetic demand structures are frequently used for simplicity in these equilibrium models, but they do not accurately capture demand behavior. In this text, we study the properties of a demand system that eliminates demand constraints often found in general equilibrium models. Specifically, we first explore the characteristics of a demand system that generalizes the standard Stone-Geary linear demand structure. Second, we illustrate its possibilities with an empirical application using available Spanish data.
Rights:	Aquest document està subjecte a una llicència d'ús Creative Commons. Es permet la reproducció total o parcial, la distribució, la comunicació pública de l'obra i la creació d'obres derivades, fins i tot amb finalitats comercials, sempre i quan es reconegui l'autoria de l'obra original.
Language:	Anglès
Document:	Article ; recerca ; Versió publicada
Subject:	Linear expenditure systems ; Constant elasticity of substitution ; Calibrated demand functions ; Computable general equilibrium
Published in:	Journal of Economic Structures, Vol. 13 Núm. 10 (2024) , ISSN 2193-2409

DOI: 10.1186/s40008-024-00330-5

11 p, 1.2 MB

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