This paper derives a complete system of commodity-expenditure and money demand equations. This approach seeks to: 1) unify the treatment of joint intertemporal decisions regarding the allocation of income and savings to expenditures on commodities; 2) accommodate a treatment of durable goods; 3)...

This paper seeks to distinguish between principles upon which testing of statistical hypotheses may be based and the practical methods which these principles generate. Seber's (1964) conclusion, that the Wald, Lagrange Multiplier and Likelihood Ratio Principles all lead to the same test...

This paper demonstrates that the extended linear expenditure system with durables (DELES) satisfies first-order conditions for local unidentifiability, and discuss alternative methods that might be used to achieve identifiability, as well as their implications. Estimates are presented using...

It is argued that the general formulation of point-optimal tests, as summarized in King (1988): i) makes use of a benchmark which is excessively stringent; ii) fails to integrate the method with traditional testing methods; iii) uses data to form a specific null hypothesis; iv) offers no...

When coefficients of endogenous variables are known, two-stage least squares and instrumental variables estimators are invariant to the form in which these variables enter computations, as raw data or estimates. Exclusion of instruments and knowledge of coefficients are related to...

The geometry of least squares is exploited to develop an exact test of the Hausman (1978) type of a linear hypothesis. This leads to necessary and sufficient conditions for the equivalence of Hausman and classical tests. The geometrical theory is then extended to the general problem of...

This note estimates the Linear Expenditure System (LES), the Extended Linear Expenditure System (ELES), and the Extended Linear Expenditure System with Durables (DELES), under two alternative error specifications using seasonally adjusted quarterly Australian data for 1959Q4-1976Q2. The purpose...

This paper distinguishes between the principles upon which testing statistical hypotheses may be based and the practical methods these principles generate. Seber's (1964) conclusion that the Wald, Lagrange Multiplier and Likelihood Ratio Principles all yield the same test statistic for linear...

This paper considers the relations between the classical identifiability test statistic and corresponding significance tests of the coefficients of endogenous variables of one equation of a linear interdependent system in the context of Generalized Classical Linear (GCL) estimation. Known...

This note applies the traditional analysis of specification error to the Cox-tests for separate regression models. Incorrect inclusion of variables in the alternative model leads to consistent tests of the null, whereas incorrect exclusion of variables from the alternative may render the tests...