Semiparametric Estimation of Consumption Based Equivalence Scales: The Case of Germany

Ralf Wilke

No 04-53 [rev.], ZEW Discussion Papers from ZEW - Leibniz Centre for European Economic Research

Abstract: Consumption based equivalence scales are estimated by applying the extended partially linear model (EPLM) to the 1998 Income and Consumption Survey (EVS) carried out in Germany. In this model the equivalence scales are identified by virtue of nonlinearities in household demand. Therefore, the econometric framework should not impose any strong restrictions on the functional forms of household expenditure shares. The chosen semiparametric specification meets this requirement. It is flexible, it yields N-consistent parameter estimates, and is consistent with consumer theory. Estimated equivalence scales are below or in the range of the expert equivalence scales of the German social benefits system.

Keywords: semiparametric estimation; wild bootstrapping; equivalence scales; social benefits (search for similar items in EconPapers)
JEL-codes: C14 C31 D12 H53 (search for similar items in EconPapers)
Date: 2005
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Citations: View citations in EconPapers (3)

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Related works:
Journal Article: Semi-parametric estimation of consumption-based equivalence scales: the case of Germany (2006)
Journal Article: Semi‐parametric estimation of consumption‐based equivalence scales: the case of Germany (2006)
Working Paper: Semiparametric Estimation of Consumption Based Equivalence Scales: The Case of Germany (2004)
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