Theoretical consistency property applied to the micro-economic modelling with flexible functional forms
| Authors | |
|---|---|
| Year of publication | 2002 |
| Type | Article in Periodical |
| Magazine / Source | Bulletin České ekonometrické společnosti |
| MU Faculty or unit | |
| Citation | |
| Field | Economy |
| Keywords | Theoretical consistency; domain of applicability; flexible functional forms; Shephard lemma; Roy identity; indirect utility function; expenditure function;demand functions; TRANSLOG; generalized Leontief |
| Description | The paper brings a survey of flexible functional forms and summarizes the theoretical properties of several functional types(indirect utility,cost,expenditure function and the appropriate input demand systems).The notion of flexibility of the functional form (relating to the character of its parameters), consistency with the economic theory (considered in contexts of producer or consumer behaviour) and the domain of applicability (towards admissible values of independent variables)are discussed. The comparative example based on the TRANSLOG and the generalized Leontief unit cost function is chosen to elucidate the main toipc of the article. |
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