Empirical issues in the computation of Stone-Lewbel price indexes in censored micro-level demand systems

In this article, we propose an empirical method for the computation of the Stone-Lewbel (SL) price index for product aggregates, when censored samples with zero expenditures are available from household budget surveys. The proposed technique is based on a regression imputation method that takes into...

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Bibliographic Details
Published in:Applied economics letters 2018-05, Vol.25 (8), p.557-561
Main Authors: Moro, Daniele, Castellari, Elena, Sckokai, Paolo
Format: Article
Language:English
Subjects:
Budgeting
censored data
Computation
demand estimation
Demographics
Economic analysis
Economic models
Economic theory
Economics
household budget survey
Households
Price indexes
Prices
Stone-Lewbel price indexes
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Summary:In this article, we propose an empirical method for the computation of the Stone-Lewbel (SL) price index for product aggregates, when censored samples with zero expenditures are available from household budget surveys. The proposed technique is based on a regression imputation method that takes into account the price dynamics, therefore, allowing to disentangle the role of demographics from the role of prices in computing the SL index. Our simulations seem to indicate that our method is a valuable alternative.
ISSN:1350-4851
1466-4291
DOI:10.1080/13504851.2017.1346353