maximum likelihood and instrumental variable estimation of a consumer demand system for japan and sweden abstract working s model with a substitution term added is applied to annual per capita data of japan and sweden the model is estimated by ml and iv methods and the variability of the iv estimates is evaluated by means of bootstrap methods

it is not just confusion strategic uncertainty in an experimental asset market to what extent is the observed mispricing in experimental asset markets caused by strategic uncertainty and by confusion we address this question by comparing subjects initial price forecasts in two market environments one with six human traders and the other with one human and five computer traders we find that both strategic uncertainty and confusion contribute equally to the median initial forecast deviation from the fundamental value the effect of strategic uncertainty is greater for subjects with a perfect score in the cognitive reflection test and it is not significant for those with low scores

well being social capital and public policy what s new this article summarises recent empirical research on the determinants of subjective well being results from national and international samples suggest that measures of social capital including especially the corollary measures of specific and general trust have substantial effects on well being beyond those flowing through economic channels cross national samples supported by parallel analysis of suicide data show large well being effects from the quality of government finally using well being data to estimate the income equivalents non financial aspects of the workplace produces numbers so large as to suggest the existence of unexploited opportunities to improve both employee satisfaction and enterprise efficiency

financial well being in an urban area an application of multiple imputation this article estimates a model of self reported financial well being fwb using primary data collected for a southwestern u s city missing data are estimated using multiple imputation model estimates show how fwb depends on home ownership the number of children health insurance age and income multiple imputation results differ somewhat from complete case results

how do experienced traders respond to inflows of inexperienced traders an experimental analysis we conducted asset market experiments where one experienced subject interacts with five inexperienced subjects to investigate how experienced subjects change their price forecasts and trading behavior when faced with strategic uncertainty caused by inflows of inexperienced subjects only half the experienced subjects initially forecasted prices deviating more from the fundamental values in the market with five inexperienced subjects than in the final round of the experiment in which they had previously participated furthermore the majority of our experienced subjects did not change their trading behavior many experienced subjects act as price stabilizers when the inflow of inexperienced subjects is not associated with other changes in market conditions

price bubbles and crashes in experimental call markets abstract price bubbles relative to intrinsic dividend value are observed using a call market trading institution market prices tend to track intrinsic value only when the same group of highly experienced traders participate in three consecutive 15 round markets

predicting within country household food expenditure variation using international cross section estimates there is a long and distinguished literature involving demand analysis using international cross section data such models are widely used for predicting national per capita consumption however there is nothing in this literature testing the performance of estimated models in predicting demands across the income spectrum within a single country this paper fills the gap we estimate an aidads model using cross section international per capita data and find that it does well in predicting food demand across the income distribution within bangladesh this suggests that there may be considerable value in using international cross section analysis to study poverty and distributional impacts of policies

price formation in single call markets this paper reports a laboratory experiment designed to examine the price formation process in a simple market institution the single call market the experiment features random values and costs each period so each period generates a new price formation observation other design features are intended to enhance the predictive power of the bayesian nash equilibrium bne theory developed recently for this trading institution we find that the data support several qualitative implications of the bne but that subjects bid and ask behavior is not as responsive to changes in the pricing rule as the bne predictions bids and asks tend to reveal more of the underlying values and costs than predicted particularly when subjects are experienced nevertheless observed trading efficiency falls below the bne prediction the results offer more support for the bne when subjects compete against nash robot opponents a simple learning model accounts for several of the deviations from bne

relative income effects on subjective well being in the cross section abstract recent work suggests that a person s subjective well being swb depends to a large degree on relative income focusing on the underlying identification this paper makes four contributions to this literature it describes the aggregation problem with past studies implements an estimation strategy to overcome this problem finds micro level evidence in support of the hypothesis that relative income does matter in individual assessments of swb and uses cross section estimates to replicate the aggregate time series the evidence further indicates that relative income effects may be smaller at low income levels the results are obtained from ordered probit techniques and the general social survey gss

a cross country time series analysis of the volume and quality of consumption abstract using the cross section results of kravis et al 1982 and working s 1943 model we provide time series of the volume of consumption per capita and of the quality index for eight oecd countries with base u s 100 in 1975

a regional analysis of food consumption in spain abstract working s model of the engel curve is applied to food and staple food expenditures with two years spanish provincial data the functional form of working s model is tested against two other specifications and cannot be rejected the estimation results are quite comparable with those obtained by other authors we also find that spain has experienced a substantial change in the pattern of food consumption during the 1970s

limited rationality and strategic complements the implications for macroeconomics this paper considers the implications of heterogeneity in information processing abilities for macroeconomic models that exhibit strategic complements the latter is the same concept that has received much attention in the recent macro literature under the headings keynesian coordination problems and positive trading externalities we consider environments in which agents vary in terms of their ability to form expectations and ask whether it is the sophisticated agents or the naive agents who have a disproportionately large effect on macroeconomic equilibrium we find that if macroeconomic interaction exhibits strategic complementarity then it is the naive agents who have a disproportionate impact

a new cross country tabulation of the quality index of consumption abstract cross country data are used to tabulate a quality index of consumption for each of 30 countries ranging in affluence from the u s to india as well as the real income relative price and residual components of the quality index

on calculating cost of living index numbers for arbitrary income levels we present a method for calculating cost of living index numbers for arbitrary base period income levels without using heavy econometric estimation methods the second order approximation formulas contain parameters which can easily be estimated by a differential demand system using a suitable specification it is possible to work at a low level of commodity aggregation the method is demonstrated on netherlands data for the period 1952 1981 cost of living index numbers for individual households can be expected to differ substantially there are various reasons for this expectation prices paid for the same commodity can vary between households in principle each household has its own preference structure implying its own substitution behavior in the presence of changing prices income differences between households imply dif ferences in consumption patterns which in the presence of changing relative prices imply diverging cost of living index numbers especially the variation of cost of living index numbers with the reference income levels attracts a lot of attention in the public discussion there is some empirical evidence about the magnitude of this variation because most statistical offices publish more than one consumer price index the netherlands cbs for instance has three cpi s namely for all households for households of wage earners with an income below a certain limit and for households of wage earners above that limit more detailed are the results of michael 1979 hagemann 1982 and balk 1984 using consumption patterns of individual households obtained from a consumer expenditure survey they compiled price index numbers for individual households and studied the differ ences under various viewpoints the drawback of these studies is that they are based on laspeyres type price index numbers thus what in essence is compared are upper limits of household specific cost of living index numbers the substitu tion behavior is ignored this is acceptable only for relatively short periods or more generally for periods with relatively small price changes a useful feature of working with laspeyres type index numbers is that one can use highly 1 the views expressed in this paper are those of the author and do not necessarily reflect the policies of the netherlands central bureau of statistics the author gratefully acknowledges the computational assistance of h a van der grient and a j hundepool mike baye is thanked for his comments on a previous version a previous version entitled a simple method for calculating

increasing consumer well being risk as potential driver of happiness abstractthis article investigates the relation between risk and individual well being we propose a theoretical model of happiness that makes a distinction between ex ante evaluations of happiness and ex post assessments the main assumptions of the model are tested through three studies based on anchoring vignettes we show that even if ex ante consumers fear high risk and do not associate it to a high level of happiness their ex post evaluation of well being is generally higher when identical consequences result from a high risk situation than from a low risk situation control over risk taking reinforces the gap between ex ante and ex post measures of happiness thus our article provides empirical evidence about a positive relation between risk and individual well being suggesting that risky experiences have the potential to increase consumer well being

the behavior of the cost of living at different levels of real income abstract the cost of living in the netherlands from 1952 to 1977 is analyzed at three different levels of real income the increase in the cost of living is larger for the more well to do

a time series analysis of a demand system based on cross country coefficient estimates abstract annual dutch consumption data 1952 1977 for 10 goods which exhaust the consumer s budget are analyzed by means of a complete demand system whose coefficients are obtained from the cross country data collected by kravis 1982

distributional effects of true economic indexes abstract generalized integrable working system parameter estimates are used to construct the true differential indexes of a the cost of living b the real income and c the marginal prices to study distributional effects of inflation and real income in australia over the period 1970 iv to 1983 ii the findings provide useful results for disaggregate household analysis and reveal the severe bias of aggregate indexes in sectoral studies of economic welfare

the impact of religiosity on self assessments of health and happiness evidence from the us southwest using an age stratified random sample from an ongoing population based study of mexican americans 45 years of age or older living in the southwest this study fexamines the relationship between religiosity and self rated indices of physical health subjective health status and happiness after estimating a set of binary logit models and controlling for individual characteristics such as age and gender findings indicate that religiously involved respondents have a lower probability of reporting a health problem than those less or not involved further those respondents who attend religious services regularly are more likely to assess themselves healthier and happier than those reporting sporadic or no attendance however when the religious variable is factored into six constructs as the frequency of religious attendance increases the happiness measure initially increases to an inflection point then it continues to increase but at a slower rate this result is consistent with the argument that those indi

a review of bubbles and crashes in experimental asset markets this paper discusses the literature on bubbles and crashes in the most commonly used experimental asset market design introduced by smith et al it documents the main findings based on the results from 41 published papers 3 book chapters and 20 working papers

verifying a demand system by simulation abstract an intriguingly small value of the asymptotic standard error of the estimate of the income flexibility inspired us to simulate the demand system the procedure used should have more general applicability