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Consumer Demand Analysis According to GARP: Discussion

Published online by Cambridge University Press:  10 May 2017

Laura A. Blanciforti*
Affiliation:
Agricultural Economics, Division of Resource Management, West Virginia University
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Extract

This paper explores the issue of the power of nonparametric tests to check for the consistency of data with utility maximization. Alston and Chalfant provide an excellent review of nonparametric approaches to consumer-demand analysis. They test for consistency, separability, and power. The authors address two important questions: First, how does one define power for nonparametric situations, and is that definition comparable to the parametric situation? Second, can the power of nonparametric tests be improved? The authors measure the statistical power of nonparametric methods using a parametric test, though they do not address whether it is legitimate to use parametric tests on nonparametric methods.

Type
Invited Presentation
Copyright
Copyright © 1992 Northeastern Agricultural and Resource Economics Association 

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Footnotes

Scientific article no. 2361 of the West Virginia Agriculture and Forestry Experiment Station.

References

Theil, H. Linear Aggregation of Economic Relations. Amsterdam: North-Holland, 1954.Google Scholar