Interest-bearing checkable deposits are examined to test whether they should be included in measures of the U.S. money stock. Both Divisia and traditional simple-sum aggregates are constructed on the basis of tests for weak separability in a model of the demand for financial assets. Using nonparametric demand analysis, we find that several groups of assets are compatible with aggregation theory. We find empirical support for a narrow measure consisting of the components of current MIA. In tests based on a St. Louis equation and in terms of controllability, a Divisia aggregate performs better than the simple-sum MIA measure.

Interest-bearing checkable deposits are examined to test whether they should be included in measures of the U.S. money stock. Both Divisia and traditional simple-sum aggregates are constructed on the basis of tests for weak separability in a model of the demand for financial assets. Using nonparametric demand analysis, we find that several groups of assets are compatible with aggregation theory. We find empirical support for a narrow measure consisting of the components of current MIA. In tests based on a St. Louis equation and in terms of controllability, a Divisia aggregate performs better than the simple-sum MIA measure.

Health concerns are thought by many to have shifted consumption away from red meats, though econometric evidence is mixed. Testing for structural change is difficult, especially when one time series is used for both estimating demand equations and testing their stability. Specification errors may suggest a shift where none has occurred. Using nonparametric demand analysis, we find that meat consumption patterns in the United States and Australia can be explained using only relative prices and expenditures. Only imposing particular functional forms can reverse the conclusion, suggesting that specification errors in econometric demand studies can account for findings of taste changes.

Health concerns are thought by many to have shifted consumption away from red meats, though econometric evidence is mixed. Testing for structural change is difficult, especially when one time series is used for both estimating demand equations and testing their stability. Specification errors may suggest a shift where none has occurred. Using nonparametric demand analysis, we find that meat consumption patterns in the United States and Australia can be explained using only relative prices and expenditures. Only imposing particular functional forms can reverse the conclusion, suggesting that specification errors in econometric demand studies can account for findings of taste changes.