eprintid: 10113004
rev_number: 17
eprint_status: archive
userid: 608
dir: disk0/10/11/30/04
datestamp: 2020-10-23 11:34:03
lastmod: 2021-11-11 23:41:20
status_changed: 2020-10-23 11:34:03
type: article
metadata_visibility: show
creators_name: Blundell, R
title: Estimation of a Heterogeneous Demand Function with Berkson Errors
ispublished: inpress
divisions: UCL
divisions: B03
divisions: C03
divisions: F24
note: This version is the author accepted manuscript. For information on re-use, please refer to the publisher’s terms and conditions.
abstract: Berkson errors are commonplace in empirical microeconomics. In consumer demand this form of measurement error occurs when the price an individual pays is measured by the (weighted) average price paid by individuals in a group (e.g., a county), rather than the true transaction price. We show the importance of Berkson errors for demand estimation with nonseparable unobserved heterogeneity. We develop a consistent estimator using external information on the true price distribution. Examining gasoline demand in the U.S., we document substantial within-market price variability. Accounting for Berkson errors is quantitatively important. Imposing the Slutsky shape constraint reduces sensitivity to Berkson errors.
date: 2020
date_type: published
official_url: https://doi.org/10.1162/rest_a_01018
oa_status: green
full_text_type: other
language: eng
primo: open
primo_central: open_green
verified: verified_manual
elements_id: 1823516
doi: 10.1162/rest_a_01018
lyricists_name: Blundell, Richard
lyricists_id: RBLUN25
actors_name: Blundell, Richard
actors_id: RBLUN25
actors_role: owner
full_text_status: public
publication: Review of Economics and Statistics
citation:        Blundell, R;      (2020)    Estimation of a Heterogeneous Demand Function with Berkson Errors.                   Review of Economics and Statistics        10.1162/rest_a_01018 <https://doi.org/10.1162/rest_a_01018>.    (In press).    Green open access   
 
document_url: https://discovery.ucl.ac.uk/id/eprint/10113004/1/berkson_paper_2020_07_12.pdf