HABITS AND AUTOCORRELATION IN THE ALMOST IDEAL DEMAND SYSTEM APPLIED TO FOOD

Laura Blanciforti

No 276792, Staff Reports from United States Department of Agriculture, Economic Research Service

Abstract: A complete system of budget share equations for U.S. food consumption was estimated using alternative specifications of the Almost Ideal Demand System (AIDS) and four food groups. The specifications accounted for habits, through a systematic change in one of the parameters, and first-order autocorrelation. The theoretical structure of the AIDS enabled the utility maximization framework to remain intact, satisfied the theoretical properties pertaining to demand systems, and provided a way to ascertain the amount that habits affected current consumption. Likelihood ratio tests indicated that both habits and autocorrelation were present.

Keywords: Demand and Price Analysis; Food Consumption/Nutrition/Food Safety (search for similar items in EconPapers)
Pages: 28
Date: 1984-01
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:uerssr:276792

DOI: 10.22004/ag.econ.276792

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