The Econometric SocietyEdited by: Guido W. Imbens • Print ISSN: 0012-9682 • Online ISSN: 1468-0262
Econometrica: Apr, 1969, Volume 37, Issue 2
https://doi.org/0012-9682(196904)37:2<257:DFAATT>2.0.CO;2-4
p. 257-274
Kunio Yoshihara
The first section of this paper deals with the properties any demand system should have if it is derived from any utility function. We find that the utility function under consideration could not be homogeneous if we impose the condition that the income elasticity is not one for all commodities. We then examine four mayor demand systems often used in empirical studies to see if they meet the properties listed in the first section. We find that Stone's linear expenditure system and Houthakker's indirect addilog system pass the theoretical tests, whereas the double log system and Theil's differential specifications do not. We fit the two theoretically satisfactory systems to Japanese data, and find that Stone's system explains the pattern of Japanese demand far better than Houthakker's. We, thus, suggest, on a theoretical as well as empirical ground, that Stone's linear expenditure system shall be the demand system in future econometric models in Japan.
March 5, 2024
The terms of the Editors of the Econometric Society's three journals end June 30, 2025. We are pleased to announce the incoming Editors and to thank the outgoing Editors for their excellent and continuing service.
Econometrica: Since 2019, Guido Imbens has served as the 14th Editor of Econometrica. On July 1, 2025, Marina Halac will become the Editor.
Quantitative Economics: Stéphane Bonhomme has been the Editor of Quantitative Economics since 2021. His successor will be Bernard Salanié.
Theoretical Economics: The Editor of Theoretical Economics since 2021 has been Simon Board. Taking over for him in July 2025 will be Federico Echenique.
Guido, Stéphane, and Simon have been outstanding Editors. We are grateful to them for the work they have done and will continue to do, and we look forward to further congratulating them next year. We believe Marina, Bernard, and Federico will be outstanding successors and we thank them in advance for their service.
Finally, we are grateful to Larry Samuelson for chairing all three search committees, and we thank the search committee members for their hard and fruitful work:
Econometrica: Christian Dustmann, Lars Hansen, Alessandro Lizzeri, George Mailath, Ariel Pakes, Helene Rey, and Elie Tamer.
QE: Kate Ho, Michael Keane, Felix Kubler, Whitney Newey, and Frank Schorfheide.
TE: Jeff Ely, Johannes Horner, Gilat Levy, Meg Meyer, and Ran Spiegler.
