Lise Salvas-Bronsard

On price exogeneity in complete demand systems

Abstract Complete demand systems have always been estimated under the assumption that either prices or quantities were exogenous. In this paper, we introduce some explicit price adjustment process and test the assumption of exogeneity of prices. Comparing the model with endogenous prices to the model with exogenous prices will reveal that the assumption of the exogeneity of prices is not a very dramatic one as both estimated models are very similar in many experiments with American and Canadian data. Applying a system-wide Wu-Hausman test and a likelihood ratio test, will always lead us to reject the exogeneity of prices in three-commodity models, while at the more disaggregated level, prices may often be considered as exogenous.

Estimating demand equations: The converse approach

The sum over individuals of the differentials of demand functions is the basic starting point of the Rotterdam model. In this paper, we show that this global differential can be inverted. Moreover, it can be parametrized according to the lines of the Rotterdam model. Consequently, we have two complete specifications in order to analyse demand and they compete on a priori grounds. After discussing the characteristics of each model relative to the stochastic assumptions used for its estimation, the structure of substitution-complementarity that it allows and its power for Computational Economics, we estimate both models and compare their results.

Anticipations rationnelles, fonctions d'anticipations et structure locale de Slutsky. (Rational Expectations, Expectation Functions, and Slutsky Local Structure. With English summary.)

Rational expectations, expectation functions, and Slutsky local structure. In this paper, it is shown that rational expectations can imply the existence of rational expectations functions. These functions are differentiable; they take into account the intertemporal substitution effects so that a temporary equilibrium does always exist and they obey to the Le Chatelier Principle (an increase in the level of a future initial endowment is associated to a decrease in the level of its expected price). It follows from these rational expectations functions that some meaningful theorems of the neoclassical theory are maintained, that is, complete temporary demand systems have a Slutsky local

Growth, Desirability, Profitability and Unemployment

In this paper, we consider how the standard tools of micro-economic analysis can be used to study comparative statics and normative dynamics of macroeconomic analysis.

Structural unemployment and disequilibrium

Abstract In this paper, we present a disequilibrium model of the labor market which allows us to distinguish cyclical unemployment due to wage rigidity from structural unemployment. This is done through the insertion, in the exchange condition of an aggregate disequilibrium model, of variables measuring mismatch between disaggregated labor supplies and labor demands. Such a model also allows unemployment and job vacancies to coexist. The model is estimated using Canadian quarterly data from 1966 to 1983. Our results imply that structural unemployment due to inter-industrial shocks while significant is fairly small.