Robert Gillingham

Demographic Effects in Demand Analysis: Estimation of the Quadratic Expenditure System Using Microdata

The purpose of this paper is to estimate a complete, theoretically plausible system of demand equations on microdata, using the rich detail of these data to investigate the impact of demographic variables on demand behavior. The system which we estimate is the quadratic expenditure system (QES) introduced by Howe, Pollak and Wales. We evaluate four methods for incorporating demographic variables into the demand system. Three of these procedures imply parameter restrictions while the fourth does not. Tests on the restrictions imply that, for our data, unrestricted estimation yields significantly greater explanatory power.

The Short-run Residential Demand for Electricity

The model of short-run residential demand for electricity combines price-schedule information obtained from the Federal Energy Regulatory Commission with household-specific data from the 1972-73 Consumer Expenditure Survey to determine the households level of electricity consumption and relate it to the households demographic profile and appliance stock. The overall short-run price-elasticity estimate of -0.550 supports existing findings that short-run residential electricity demand is price inelastic. However, the variation in elasticities across end-use categories suggests that the overall response is made up of a complex set of responses that vary substantially and significantly across appliances. This implies that it may be more efficient to tailor conservation policies to the stock configuration of the population. 17 references, 6 tables.

Cross-sectional estimation of a simultaneous model of tenure choice and housing services demand

Abstract In this paper we analyze the demand for housing services, integrating into a single analysis a systematic treatment of several important conceptual and empirical issues. Our three major objectives are to (1) evaluate the empirical importance of the simultaneity between the tenure choice and consumption level decisions; (2) analyze the relationship between household type and housing demand; and (3) present new estimates of the parameters of housing demand which are based on detailed microdata. In the process, we derive and estimate overall income and price demand elasticities which incorporate the impacts of income and price on both the tenure choice and consumption level decisions.

The Impact of Direct Taxes on the Cost of Living

In this paper, the authors define a cost-of-living index including direct taxes. They show its relationship to the traditional index and demonstrate how nonconsumption costs are properly treated. They t hen define a fixed-weight approximation, a tax and price index (TPI). Using federal, state, local, and social security tax rates for 1967- 85, the authors construct annual TPI series based on household data. They find that inclusion of direct taxes has sizable impacts on the e stimated rate of inflation. Partitioning their household sample, they find that recognition of taxes significantly alters inflation rate d ifferentials estimated using consumption prices alone. Copyright 1987 by University of Chicago Press.

Analytical problems in the measurement of the quality of life

The absence of an explicit theoretical framework seems to have led to a number of objectionable features — empirical as well as conceptual — in previous attempts to construct and apply QOL measures. This paper presents a theoretical framework for QOL measurement based on individual utility maximization. Without severe restrictions on the form of the utility function, however, this framework does not lead to meaningful average or aggregate QOL measures. Furthermore, our empirical analysis indicates that attempts to use currently available QOL measures — despite their conceptual inadequacy — in the analysis of migration have been ill conceived.

Estimating Inter-city Differences in the Price of Housing Services: Further Evidence 1

This paper reconsiders an approach to inter-area house price index construction applied by Harvey Rosen in a recent article in Urban Studies. Rosens cost function-based approach is shown to rely upon certain implicit assumptions regarding consumer preferences and housing production technology. Using FHA home purchase data, we estimate a more general production model and generate alternative inter-area indexes. Based on our results, Rosens production technology assumptions are rejected. Further, the production-theoretic indexes are shown to differ only negligibly from a fixed-weight index using FHA data. Thus the difference which Rosen finds between the production-theoretic FHA and published BLS indexes does not result from Rosens recognition of substitution in production, but because of very different data sources and scopes of coverage.