Gaids: a generalised version of the almost ideal demand system

Bollino, Carlo Andrea

doi:10.1016/0165-1765(87)90039-5

Cited by 45 publications

(28 citation statements)

References 2 publications

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“…Let p i and q i denote the price and quantity of the i th food group, respectively, and let X be total food expenditures. Assume that we have the following indirect utility function (V) with underlying price‐independent logarithmic preferences (Bollino, ; Banks et al ., ; Hovhannisyan and Gould, ):

ln V = {(][, {()(, \frac{ln (s) - ln (P)}{b (p)})}^{- 1} + italicλ (p))}^{- 1}

where s is supernumerary expenditures (

s = X - \sum_{i} c_{i} p_{i}

), with c i representing pre‐committed demand (i.e. independent of expenditure and price effects); P is a price index, with

ln false(P false) = {italicα}_{0} + \sum_{j} α_{j} ln (p_{j}) + 0.5 \sum_{i} \sum_{j} {italicγ}_{i j} ln false(p_{j} false) ln false(p_{i} false)

;

b false(p false) = \prod p_{k}^{β_{k}}

is a price aggregator; λ ( p ) = ∑ i λ i ln ( p i ) is homogeneous of degree zero in prices, with

\sum_{i} λ_{i} = 0

; and α , β , γ , λ are unknown utility function parameters.…”

Section: Methodsmentioning

confidence: 99%

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Price Endogeneity and Food Demand in Urban China

Hovhannisyan¹,

Bozic²

2016

J Agricultural Economics

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Price endogeneity has been ignored in previous analyses of food demand in urban China. We exploit data provided by the China National Bureau of Statistics on agricultural commodity supply shifters and use reduced‐form price equations to account for price endogeneity. Applying our unique econometric approach to the analysis of provincial‐level food demand in China, we find strong statistical evidence of price endogeneity. Models that ignore price endogeneity result in substantially biased elasticities and misleading estimates of future food demand in China.

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ln V = {(][, {()(, \frac{ln (s) - ln (P)}{b (p)})}^{- 1} + italicλ (p))}^{- 1}

where s is supernumerary expenditures (

s = X - \sum_{i} c_{i} p_{i}

), with c i representing pre‐committed demand (i.e. independent of expenditure and price effects); P is a price index, with

ln false(P false) = {italicα}_{0} + \sum_{j} α_{j} ln (p_{j}) + 0.5 \sum_{i} \sum_{j} {italicγ}_{i j} ln false(p_{j} false) ln false(p_{i} false)

;

b false(p false) = \prod p_{k}^{β_{k}}

is a price aggregator; λ ( p ) = ∑ i λ i ln ( p i ) is homogeneous of degree zero in prices, with

\sum_{i} λ_{i} = 0

; and α , β , γ , λ are unknown utility function parameters.…”

Section: Methodsmentioning

confidence: 99%

“…The AIDS model is obtained via the joint restrictions

{italicλ}_{i} = 0, c_{i} = 0, \forall i = 1, \dots, n

. The Generalized AIDS (GAIDS) model, originally developed by Bollino (), is obtained using the assumption

{italicλ}_{i} = 0, \forall i = 1, \dots, n

. Finally, the Quadratic AIDS (QUAIDS) specification is obtained via the joint restrictions

c_{i} = 0, \forall i = 1, \dots, n

…”

Section: Methodsmentioning

confidence: 99%

Price Endogeneity and Food Demand in Urban China

Hovhannisyan¹,

Bozic²

2016

J Agricultural Economics

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“…Three different demand system specifications are used here. As shown by Bollino (1990) and further noted by Piggott and Marsh (2004) the GAIDS (Generalized Almost Ideal Demand System) model specification allows for nonprice and nonincome effects to be evaluated in a manner consistent with derived elasticities being invariant to the units of measurement. However, the 'cost' of this improvement is added nonlinearity to the more traditional AIDS model.…”

Section: Methodsmentioning

confidence: 99%

Do starting values really matter? Development of a genetic algorithm approach

Tonsor

Kastens

2009

Applied Economics Letters

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“…We use as parametric function the Generalized Almost Ideal demand model (Bollino, 1987), which satisfies consumer theory restrictions, i.e., adding up, symmetry, homogeneity and heterogeneous consumer exact aggregation constraints. 9 The functional forms for demand functions are in the first stage: …”

Section: Optimal Pricing and Demand Behaviormentioning

confidence: 99%