Dynamics Almost Ideal: Demand System Application of Kalman Filter
The demand elasticity for a product is the basis of its price determination. The ratio in which a product demand will fall with the rise in its price and, vice versa, can be known as demand elasticity. With increasing population and increasing demand for meat, it is important to accurately estimate...
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| Format: | Article |
| Language: | English |
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Czech Statistical Office
2021-03-01
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| Series: | Statistika: Statistics and Economy Journal |
| Subjects: | |
| Online Access: | https://www.czso.cz/documents/10180/143570303/32019721q1_sherafatmand_analyses.pdf/f2b89bd4-63a2-4894-ab11-3aa62e8dd399?version=1.1 |
| _version_ | 1819280881668325376 |
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| author | Habibeh Sherafatmand Ali Akbar Baghestany |
| author_facet | Habibeh Sherafatmand Ali Akbar Baghestany |
| author_sort | Habibeh Sherafatmand |
| collection | DOAJ |
| description | The demand elasticity for a product is the basis of its price determination. The ratio in which a product demand will fall with the rise in its price and, vice versa, can be known as demand elasticity. With increasing population and increasing demand for meat, it is important to accurately estimate price and income demand elasticities. This paper used almost ideal demand systems (AIDS) with log linear analogue of the Paasche price index, referred to as the corrected Stone index to model consumer demand system. The study employs the Kalman filter estimation strategy, which is based on state-space models that are applied to linear regressions with stochastically time-varying parameters, to determine the evolution of price and income elasticities of red meat and fish demand for monthly data 1997–2017. Variables stationary is tested with Hegy test. Results show that Price elasticity for fish is elastic. Elasticity results indicate that the two products are strong substitutes. Income elasticity indicated that fish considered to be luxury good. |
| first_indexed | 2024-12-24T00:50:51Z |
| format | Article |
| id | doaj.art-25becff50df7413c85617c5565ff79be |
| institution | Directory Open Access Journal |
| issn | 0322-788X 1804-8765 |
| language | English |
| last_indexed | 2024-12-24T00:50:51Z |
| publishDate | 2021-03-01 |
| publisher | Czech Statistical Office |
| record_format | Article |
| series | Statistika: Statistics and Economy Journal |
| spelling | doaj.art-25becff50df7413c85617c5565ff79be2022-12-21T17:23:35ZengCzech Statistical OfficeStatistika: Statistics and Economy Journal0322-788X1804-87652021-03-01101191100Dynamics Almost Ideal: Demand System Application of Kalman FilterHabibeh Sherafatmand0Ali Akbar Baghestany 1Islamic Azad University, Tehran, IranEconomic and Rural Development Research Institute, Tehran, IranThe demand elasticity for a product is the basis of its price determination. The ratio in which a product demand will fall with the rise in its price and, vice versa, can be known as demand elasticity. With increasing population and increasing demand for meat, it is important to accurately estimate price and income demand elasticities. This paper used almost ideal demand systems (AIDS) with log linear analogue of the Paasche price index, referred to as the corrected Stone index to model consumer demand system. The study employs the Kalman filter estimation strategy, which is based on state-space models that are applied to linear regressions with stochastically time-varying parameters, to determine the evolution of price and income elasticities of red meat and fish demand for monthly data 1997–2017. Variables stationary is tested with Hegy test. Results show that Price elasticity for fish is elastic. Elasticity results indicate that the two products are strong substitutes. Income elasticity indicated that fish considered to be luxury good.https://www.czso.cz/documents/10180/143570303/32019721q1_sherafatmand_analyses.pdf/f2b89bd4-63a2-4894-ab11-3aa62e8dd399?version=1.1aids modelfishred meatkalman filter |
| spellingShingle | Habibeh Sherafatmand Ali Akbar Baghestany Dynamics Almost Ideal: Demand System Application of Kalman Filter Statistika: Statistics and Economy Journal aids model fish red meat kalman filter |
| title | Dynamics Almost Ideal: Demand System Application of Kalman Filter |
| title_full | Dynamics Almost Ideal: Demand System Application of Kalman Filter |
| title_fullStr | Dynamics Almost Ideal: Demand System Application of Kalman Filter |
| title_full_unstemmed | Dynamics Almost Ideal: Demand System Application of Kalman Filter |
| title_short | Dynamics Almost Ideal: Demand System Application of Kalman Filter |
| title_sort | dynamics almost ideal demand system application of kalman filter |
| topic | aids model fish red meat kalman filter |
| url | https://www.czso.cz/documents/10180/143570303/32019721q1_sherafatmand_analyses.pdf/f2b89bd4-63a2-4894-ab11-3aa62e8dd399?version=1.1 |
| work_keys_str_mv | AT habibehsherafatmand dynamicsalmostidealdemandsystemapplicationofkalmanfilter AT aliakbarbaghestany dynamicsalmostidealdemandsystemapplicationofkalmanfilter |