Estimation and Welfare Calculations in a Generalized Corner Solution Model with an Application to Recreation Demand
Catherine Kling () and
Joseph Herriges ()
Staff General Research Papers Archive from Iowa State University, Department of Economics
The Kuhn-Tucker model of Wales and Woodland (1983) provides a utility theoretic framework for estimating preferences over commodities for which individuals choose not to consume one or more of the goods. Due to the complexity of the model, however, there have been few applications in the literature and little attention has been paid to the problems of welfare analysis within the Kuhn-Tucker framework. This paper provides an application of the model to the problem of recreation demand. In addition, we develop and apply a methodology for estimating compensating variation, relying on Monte Carlo integration to derive expected welfare changes.
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Published in Review of Economics and Statistics, January/February 2000, vol. 82 no. 1, pp. 83-92
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Journal Article: Estimation and Welfare Calculations in a Generalized Corner Solution Model with an Application to Recreation Demand (2000)
Working Paper: Estimation and Welfare Calculations in a Generalized Corner Solution Model with an Application to Recreation Demand (1998)
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Persistent link: https://EconPapers.repec.org/RePEc:isu:genres:1355
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