Cross-Section Data, Disequilibrium Situations and Estimated Coefficients: Evidence from Car Ownership Demand

XREAP Working Paper No. 2007-4

18 Pages Posted: 24 May 2011

See all articles by Anna Matas

Anna Matas

Autonomous University of Barcelona

Josep Lluís Raymond

Autonomous University of Barcelona

Date Written: June 1, 2007

Abstract

The objective of this paper is to analyse to what extent the use of cross-section data will distort the estimated elasticities for car ownership demand when the observed variables do not correspond to a state equilibrium for some individuals in the sample. Our proposal consists of approximating the equilibrium values of the observed variables by constructing a pseudo-panel data set which entails averaging individuals observed at different points of time into cohorts. The results show that individual and aggregate data lead to almost the same value for income elasticity, whereas with respect to working adult elasticity the similarity is less pronounced.

Suggested Citation

Matas, Anna and Raymond, Josep Lluís, Cross-Section Data, Disequilibrium Situations and Estimated Coefficients: Evidence from Car Ownership Demand (June 1, 2007). XREAP Working Paper No. 2007-4, Available at SSRN: https://ssrn.com/abstract=1850425 or http://dx.doi.org/10.2139/ssrn.1850425

Anna Matas (Contact Author)

Autonomous University of Barcelona ( email )

Plaça Cívica
Cerdañola del Valles
Barcelona, Barcelona 08193
Spain

Josep Lluís Raymond

Autonomous University of Barcelona ( email )

Plaça Cívica
Cerdañola del Valles
Barcelona, Barcelona 08193
Spain

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