The Flexible Ces-Gbc Family Of Cost Functions: Derivation And Application

Asher Tishler and Stan Lipovetsky

The Review of Economics and Statistics, 1997, vol. 79, issue 4, 638-646

Abstract: Recent research has indicated that flexible forms do not always generate empirically credible elasticity estimates. In this paper we present a methodology from which we derive a new family of flexible functional forms (denoted by CES-GBC) that are richer in structure than the cost functions in current use. We use the CES-GBC form to estimate the demand for electricity under time-of-use pricing. The estimation results are encouraging. The elasticity estimates are very reasonable and the fit of the estimated equations is far superior than the more commonly used generalized Leontief, generalized square root quadratic, or any other member of the generalized Box-Cox family of cost functions. © 1997 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology

Date: 1997
References: Add references at CitEc
Citations: View citations in EconPapers (8)

Downloads: (external link)
http://www.mitpressjournals.org/doi/pdf/10.1162/003465397557042 (application/pdf)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:tpr:restat:v:79:y:1997:i:4:p:638-646

Ordering information: This journal article can be ordered from
https://mitpressjour ... rnal/?issn=0034-6535

Access Statistics for this article

The Review of Economics and Statistics is currently edited by Pierre Azoulay, Olivier Coibion, Will Dobbie, Raymond Fisman, Benjamin R. Handel, Brian A. Jacob, Kareen Rozen, Xiaoxia Shi, Tavneet Suri and Yi Xu

More articles in The Review of Economics and Statistics from MIT Press
Bibliographic data for series maintained by The MIT Press ().