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A Quadratic Generalization of the Almost Ideal and Translog Demand Systems: An Application to Food Demand in Urban China

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  • Liu, Kang Ernest

Abstract

A new demand system, the QGAITL model, nesting the quadratic almost ideal, translog and LES models as its special cases, is introduced and estimated in this paper. Employing urban household data of four major food items from Jiangsu China in 2001, empirical evidence from both in-sample evaluations and out-of-sample forecasting comparisons shows that the QGAITL is superior to its nested models, whether or not demographic effects are incorporated.

Suggested Citation

  • Liu, Kang Ernest, 2006. "A Quadratic Generalization of the Almost Ideal and Translog Demand Systems: An Application to Food Demand in Urban China," 2006 Annual meeting, July 23-26, Long Beach, CA 21387, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea06:21387
    DOI: 10.22004/ag.econ.21387
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    4. Lewbel, Arthur, 1989. "Nesting the AIDS and Translog Demand System," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 30(2), pages 349-356, May.
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