Estimating a Demand System with Nonnegativity Constraints: Mexican Meat Demand

Amos Golan; Jeffrey M. Perloff; Edward Z. Shen

doi:10.1162/00346530152480180

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Estimating a Demand System with Nonnegativity Constraints: Mexican Meat Demand

Amos Golan¹; Jeffrey M. Perloff^2,3; Edward Z. Shen⁴

¹ American University · ² A.P. Giannini Foundation · ³ University of California, Berkeley · ⁴ Gator.com

The Review of Economics and Statistics 2001

A new information-based approach for estimating systems of many equations with nonnegativity constraints is presented. This approach, called generalized maximum entropy (GME), is more practical and efficient than traditional maximum-likelihood methods. The GME method is used to estimate an almost ideal demand system for five types of meat using cross-sectional data from Mexico, where most households did not buy at least one type of meat during the survey week. The system of demands is shown to vary across demographic groups.

DOI: 10.1162/00346530152480180
Volume: 83 (3)
Pages: 541-550
Language: en
Export: BibTeX
Sources: openalex crossref