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on Discrete Choice Models |
| By: | Andre Bonfrer; Ernst R. Berndt; Alvin Silk |
| Abstract: | We investigate the theoretical possibility and empirical regularity of two troublesome anomalies that frequently arise when cross-price elasticities are estimated for a set of brands expected to be substitutes. These anomalies are the occurrence of: (a) negatively signed cross-elasticities; and (b) sign asymmetries in pairs of cross price elasticities. Drawing upon the Slutsky equation from neoclassical demand theory, we show how and why these anomalies may occur when cross elasticities are estimated for pairs of brands that are substitutes. We empirically examine these issues in the context of the widely used Multiplicative Competitive Interaction (MCI) and Multinomial Logit (MNL) specifications of the fully extended attraction models (Cooper and Nakanishi 1988). Utilizing a database of store-level scanner data for 25 categories and 127 brands of frequently purchased branded consumer goods, we find that about 18% of a total of 732 cross elasticity estimates are negative and approximately 40% of the 366 pairs of cross elasticities are sign asymmetric. Finally, we find that the occurrence of negatively signed cross elasticities can be partially explained by a set of hypothesized relationships between cross-price elasticities and brand share and elasticities of income and category demand. |
| JEL: | D12 M30 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:12756&r=dcm |
| By: | David McKenzie (Development Research Group, World Bank); Hillel Rapoport (Department of Economics, Bar-Ilan University, CADRE, University of Lille II, and Stanford Center for International Development) |
| Abstract: | This paper examines the impact of migration on educational attainments in rural Mexico. Using historical migration rates by state to instrument for current migration, we find evidence of a significant negative effect of migration on schooling attendance and attainments of 12 to 18 year-old boys and of 16 to 18 year-old girls. IV-Censored Ordered Probit results show that living in a migrant household lowers the chances of boys completing junior high-school and of boys and girls completing high-school. The negative effect of migration on schooling is somewhat mitigated for younger girls with low educated mothers, which is consistent with remittances relaxing credit constraints on education investment for the very poor. However, for the majority of rural Mexican children, family migration depresses educational attainment. Comparison of the marginal effects of migration on school attendance and on participation to other activities shows that the observed decrease in schooling of 16 to 18 year olds is accounted for by current migration of boys and increases in housework for girls. |
| Keywords: | Migration, migrant networks, education attainments, Mexico |
| JEL: | O15 J61 D31 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:0106&r=dcm |