Variations on Invariance or Some Unpleasant Nonparametric Arithmetic
讨论非参数方法在生产和需求分析中的应用,指出线性规划调整结果对价格和数量缩放不敏感,并提出解决这一不变性问题的方案。
Abstract The nonparametric approach to production or demand analysis involves testing data for compatibility with restrictions from theory. This avoids reliance on particular functional forms. When the data are not consistent with utility or profit maximization, adjustments in the data using linear programming can restore consistency. Such adjustments have been interpreted as taste changes or measures of technical change and technical change bias. This paper describes nonparametric approaches and shows that the programming methods that have been used yield results that are not invariant to the scaling of prices and quantities. A solution is proposed that solves the invariance problem.