In this paper we assess the relationship between the aggregate income elasticity of aggregate demand and individual income elasticities of demand. We show that the aggregate elasticity is equal to the mean of individual elasticities plus a covariance term. Consequently, the sign of this covariance term determines whether the aggregate elasticity overestimates or underestimates the mean of indiv...

There is a substantial controversy in the economic literature over the magnitude of the expenditure elasticity for food grain in China that is caused, to a large extent, by whether time-series or cross-section data are used in the analysis. A set of reasonable elasticities for a complete demand system is estimated by using a panel of county level data in Guangdong Province for the last ten year...

The paper deals with different concepts of income elasticities of demand for a heterogenous population and the relationship between individual and aggregate elasticities is analyzed. In general, the aggregate elasticity is not equal to the mean of individual elasticities. The difference depends on the heterogeneity of the population and is quantified by a covariance term. Sign and magnitude of ...

The elasticity of taxable income indicates the effects on income from a change in the marginal tax rate. In a number of studies on U.S. data rather strong effects have been found, although estimates seem lower in more recent papers. Studies based on data from other countries are only a few and indicate lower effects. A difference-in-differences approach utilising differences in tax changes is t...

The calorie-income demand elasticity is an important parameter in the development literature and in the policy arena. Yet, there is very little evidence on the extent to which it can be considered as an unchanging parameter or a time-shifting parameter that, for example, changes with the economic conditions faced by households. In the event that the latter case is a more accurate description of...

This is the first study to attempt to explain income inequality using unemployment and inflation and international cross-sectional data. Using a SURE system, inflation is found to have an increasing impact on the shares of the lower 80% of the income distribution, while reducing the share of the highest 20%. Unemployment has a negative effect on the share of the first 40%, while increases the s...

This paper analyzes determinants of ex-manufacturer prices for originator and generic drugs across countries. We focus on drugs to treat HIV/AIDS, TB, and malaria in middle and low-income countries (MLICs), with robustness checks to other therapeutic categories and the full income range of countries. We examine the effects of per capita income, income dispersion, competition from originator and...