1 / 6

Estimating Social Surplus from Demand: Insights from Chapter 13

Chapter 13 delves into the estimation of social surplus using demand analysis. By examining linear demand relations, we can measure elasticity through coefficients in the equation q = a0 + a1P. The chapter discusses how changes in surplus can be derived from slope or elasticity estimates through regression of price and quantity data. It highlights the importance of demand systems and the role of various functional forms in analyzing elasticity. Additionally, the evaluation of social assistance changes pre- and post-intervention provides key insights into the impacts of client attributes on assistance requirements.

ike
Télécharger la présentation

Estimating Social Surplus from Demand: Insights from Chapter 13

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Highlights of Chapter 13

  2. Estimating social surplus from demand • The linear demand relation provides the measures elasticity from the coefficients • q = a0 + a1P • Surplus change arising from a slope estimate or elasticity estimate may emerge from a regression of prices and quantities. • The typical approach to estimate demand is the system • qd = a0 + a1P+a2Y • qs = b0 + b1P+b2i • qd=qs • The elasticity varies along the demand “curve”

  3. Many functional forms exist for demand relations. The constant elasticity form yield then same value anywhere along the relationship. Q = B0pB1 Lnq = lnB0 + B1lnp

  4. Extrapolating can lead to error

  5. THESE ARE THE RESULTS OF THE TAKING CHARGE EVALUATION. The dependent variable is the difference in social assistance received before and after for the comparison group relative to the control group. There is a single “comparison” group (amalgam of for three programs) and main program group (Taking Charge). The control group is social assistance clients that never took training. See: http://www.hrsdc.gc.ca/eng/cs/sp/hrsdc/edd/reports/1999-000448/sp-ah109-e.pdf Interpreting Regression Results – net impact estimation See notes page

  6. The three hypothetical cases show how client attributes and intervention interact to produce different expected changes in income assistance after the intervention. Table 37 shows a net decrease in assistance payments for Case 1 ($280), a decrease of $73 for Case 2 and a reduction of $79 per month for Case 3.

More Related