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A Uniform Substitute Demand Model with Varying Coefficients
Mark G. Brown, Jong-Yinq Lee
Journal:

Journal of Agricultural and Applied Economics / Volume 32 / Issue 1 / April 2000

Published online by Cambridge University Press:

28 April 2015, pp. 1-9
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This study extends Batten's synthetic demand modeling approach to increase the flexibility of the uniform substitute specification of the Rotterdam demand system. Marginal propensities to consume (MPC) vary with budget shares and Slutsky coefficients are defined in terms of varying MPCs. An application of the model to orange-juice products shows that the pattern of income and price elasticities over time is much different than when MPCs are restricted to be constant.

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A Uniform Substitute Demand Model with Varying Coefficients