Marginal and conditional probabilities of excess demand

Burkett, John P.

doi:10.1016/0165-1765(81)90010-0

Cited by 11 publications

(4 citation statements)

References 5 publications

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“…There are various criteria by which we can assign each observation to an excess demand or excess supply regime. In past work, we have used the estimated marginal or conditional (on the observed C) probability that CDt > CS (Burkett, 1981 showed that the marginal and conditional probabilities were very close for Poland in the original P-W study).…”

Section: Resultsmentioning

confidence: 99%

Macroeconomic Planning and Disequilibrium: Estimates for Poland, 1955-1980

Portes

Quandt

Winter³

et al. 1987

Econometrica

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This paper specifies and estimates a four-equation disequilibrium model of the consumption goods market in a centrally planned economy (CPE). The data are from Poland for the period 1955-1980, but the analysis is more general and will be applied to other CPEs as soon as the appropriate data sets are complete. This work is based on previous papers of Portes and Winter (P-W) and Charemza and Quandt (C-Q). P-W applied to each of four CPEs a discrete-switching disequilibrium model with a household demand equation for consumption goods, a planners' supply equation, and a "mm" condition stating that the observed quantity transacted is the lesser of the quantities demanded and supplied. C-Q considered how an equation for the adjustment of planned quantities could be integrated into a CPE model with fixed prices and without the usual price adjustment equation. They made plan formation endogenous and permitted the resulting plan variables to enter the equations determining demand and supply. This paper implements the C-Q proposal in the P-W context. It uses a unique new data set of time series for plans for the major macroeconomic variables in Poland and other CPEs. The overall framework is applicable to any large organization which plans economic variables.

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Section: Resultsmentioning

confidence: 99%

Macroeconomic Planning and Disequilibrium: Estimates for Poland, 1955-1980

Portes

Quandt

Winter³

et al. 1987

Econometrica

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“…Let's look at some terms. [1][2][3] "Probability" or "Probable" derives from Latin "Probabilis" which means plausible or generally approved. "Probability", or another common term "Chance", deals with the stochastic (random) processes which lie behind data or outcomes.…”

Section: What Do You "Expect"?mentioning

confidence: 99%

What do you “Expect”?

Kaewkungwal

2018

OSIR

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“…Yeo (1985, 1988) suggest using a likelihood ratio test for an unrestricted likelihood function (computed for a Portes-type model) and its 'allexcess-demand' counterpart. Another approach consists in examining the computed conditional and marginal probabilities of excess demand (see Burkett, 1981). Rogers (1984) develops this idea by deriving a simple test in which a statistic of the probability of excess demand (given the estimated parameters and of sample size), is asymptotically normally distributed.…”

Section: 'Disequilibrium Indicators' Modelsmentioning

confidence: 99%

Computational Controversies in Disequilibrium and Shortage Modelling of Centrally Planned Economies

Charemza

1989

Journal of Economic Surveys

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Abstrac!. Most disequilibrium and shortage models of centrally planned economies fall into three categories: testable excess demand (the Portes school), disequilibrium indicators, and Kornai's economics of shortage. These models have generated numerous controversies and conflicting empirical results. However, this paper argues that some disputes are not caused by the theoretical features of the models but rather by the utilisation of different estimation methods that are not directly comparable. This suggests that several controversies are more apparent than real and can he resolved through the improvement of computational techniques and statistical hypothesis testing theory.Most fields of applied econometrics employ common statistical techniques in estimation that are, to a large extent, independent of the specification of particular models. Observable differences are usually caused by variations in the computational and financial resources of researchers rather than by alternative theoretical approaches. Models are estimated in similar ways, whether they are grounded in neo-Keynesian, neo-classical or Marxian economics. This is usually not the case for disequilibrium econometric investigations of the centrally planned economy (CPE). Estimation techniques used in disequilibrium studies are often not comparable, even when the same phenomenon is being analysed. Disequilibrium models are estimated and tested under different assumptions, which relate primarily to computational technique rather than to the economic theory. In consequence, any Comparative evaluation of these models is of questionable merit if it is not preceded by a thorough assessment of the estimation techniques utilised, especially their open and hidden assumptions.The importance of rigorous comparative analyses of disequilibrium econometric models of CPEs has increased in the 1980s, because of heightened interest in problems of socialist economics. With the increase of the number of empirical studies in this field it has become evident that even models based on similar economic foundations, such as the neo-Keynesian concepts of effective 0950-0804/89/04

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Marginal and conditional probabilities of excess demand

Cited by 11 publications

References 5 publications

Macroeconomic Planning and Disequilibrium: Estimates for Poland, 1955-1980

Macroeconomic Planning and Disequilibrium: Estimates for Poland, 1955-1980

What do you “Expect”?

Computational Controversies in Disequilibrium and Shortage Modelling of Centrally Planned Economies

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