Joint Distribution of Demand Functions and Price Expectation Functions, and Structural Properties of Market Demand

Isabelle Maret
Additional contact information
Isabelle Maret: CORE, Universite catholique de Louvain, B-1348 Louvain-la-Neuve, Belgium

No 1995026, LIDAM Discussion Papers CORE from Université catholique de Louvain, Center for Operations Research and Econometrics (CORE)

Abstract: Properties of the demand of a large population introduced by the aggregation process are studied. The idea is to consider assumptions on the distribution of household characteristics rather than focusing on the modelling of individual behavior. By opposite to the existing literature where the Law of Demand is deduced from distributional requirements, the expectation about future prices are explicitely introduced in the household decision rule. Hence, heterogeneity of household behavior can be interpreted as reflecting heterogeneity in tastes and risk aversion which generates the distribution of demand functions and heterogeneity of the expectation rules which generates the distribution of expectation functions. It is proved that the introduction of assumptions on the distribution of these expectations rules (in addition to reasonable assumptions on the distribution of demand functions) allow to give an account of the Law of Demand, independently of strong restrictions on the Jacobian matrix of market demand.

JEL-codes: D11 D30 D41 D91 (search for similar items in EconPapers)
Date: 1995-04-01
References: Add references at CitEc
Citations:

Downloads: (external link)
https://sites.uclouvain.be/core/publications/coredp/coredp1995.html (text/html)

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:cor:louvco:1995026

Access Statistics for this paper

More papers in LIDAM Discussion Papers CORE from Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) Voie du Roman Pays 34, 1348 Louvain-la-Neuve (Belgium). Contact information at EDIRC.
Bibliographic data for series maintained by Alain GILLIS ().