This paper develops a new approach to the estimation of consumer demand models with unobserved heterogeneity subject to revealed preference inequality restrictions. Particular attention is given to nonseparable heterogeneity. The inequality restrictions are used to identify bounds on counterfactual demand. A nonparametric estimator for these bounds is developed and asymptotic properties are derived. An empirical application using data from the UK Family Expenditure Survey illustrates the usefulness of the methods.
Authors
CPP Co-Director
Richard is Co-Director of the Centre for the Microeconomic Analysis of Public Policy (CPP) and Senior Research Fellow at IFS.
UCLA
Dennis Kristensen
Journal article details
- DOI
- 10.1016/j.jeconom.2014.01.005
- Publisher
- Elsevier B.V.
- JEL
- C20, D12
- Issue
- Volume 179, Issue 2, April 2014, pages 112-127
Suggested citation
R, Blundell and D, Kristensen and R, Matzkin. (2014). 'Bounding quantile demand functions using revealed preference inequalities' 179(2/2014), pp.112–127.
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