Panel and Pseudo-Panel Estimation of Cross-Sectional and Time Series Elasticities of Food Consumption

By F. Gardes, G. Duncan, P. Gaubert, Marc Gurgand, Christophe Starzec. 2005

73 citations recorded by the source corpus.

This article addresses the problem of the bias of income and expenditure elasticities estimated on pseudopanel data caused by measurement error and unobserved heterogeneity. We gauge these biases empirically by comparing cross-sectional, pseudo-panel, and true panel data from both Polish and U.S. expenditure surveys. Our results suggest that unobserved heterogeneity imparts a downward bias to cross-section estimates of income elasticities of at-home food expenditures and an upward bias to estimates of income elasticities of away-from-home food expenditures. “Within” and first-difference estimators suffer less bias, but only if the effects of measurement error are accounted for with instrumental variables.

Subfields: Economics and Econometrics, Gender Studies, General Health Professions

View Paper: https://www.semanticscholar.org/paper/5ff70806affc51d52e728b84ba479b25c8f6537b

Citations in the corpus

• The Effects of a Fat Tax on French Households’ Purchases: A Nutritional Approach (2010, unknown): “Gardes et al. (2005) propose the same aggregation process, but the main difference in their approach is that, in our study, the total household food expenditure is not known and θ̂hct estimates the true share θhct .”