Abstract
This paper presents an easy to apply formula which can be used to assess the efficiency gains from imposing symmetry constraints on a system of demand equations. The interrelationship of the correlation between errors and the correlation between variables is shown to have a significant impact on efficiency gains. Standard results on efficiency gains from seemingly unrelated regression are shown to be inapplicable.
| Original language | English (US) |
|---|---|
| Pages (from-to) | 217-222 |
| Number of pages | 6 |
| Journal | Economics Letters |
| Volume | 22 |
| Issue number | 2-3 |
| DOIs | |
| State | Published - 1986 |
ASJC Scopus subject areas
- Finance
- Economics and Econometrics