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Jerry A Hausman - One of the best experts on this subject based on the ideXlab platform.
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exact consumer s surplus and Deadweight loss
The American Economic Review, 2008Co-Authors: Jerry A HausmanAbstract:Consumer's surplus is a widely used tool in applied welfare economics. Both economic theorists and cost benefit analysis often use consumer's surplus despite its somewhat dubious reputation. The basic idea is to evaluate the value to a consumer or his "willingness to pay" for a change in price of a good from say pricep? to pricep'. Because price changes affect consumer welfare, an evaluation of this effect is often a key input to public policy decisions. Yet consumer's surplus is probably the most controversial of widely used economic concepts. Both Paul Samuelson and Ian Little conclude that the economics profession would be better off without it. It is my feeling of the situation that substantial agreement exists on the correct quantities to be measured: the amount the consumer would pay or would need to be paid to be just as well off after the price change as he was before the price change. The quantities correspond to John Hicks' compensating variation measures. An alternative measure which takes ex post price change utility as the basis of comparison is Hicks' equivalent variation.' The controversy arises in the measurement of these quantities. The usual measurement procedure is to use the area to the left of the Marshallian (market) demand curve between two price levels. Jules Dupuit originated this measure of welfare change, and Alfred Marshall and Hicks derived appropriate conditions for its use. The primary condition for the area to the left of the demand curve to correspond to the compensating variation is to have constant marginal utility of income. Marshall gave this condition, and if it holds, the same quantity will be derived as the area to the left of the compensated (Hicksian) demand curve. This area to the left of the compensated demand curve is exactly what the compensating variation and equivalent variation measure. Thus the constant marginal utility of income is a sufficient condition for Marshallian consumer's surplus to be equal to Hicks' consumer's surplus. In this case Arnold Harberger's plea to use the welfare triangle as one-half times the product of the price change times the quantity change to measure Deadweight loss corresponds to the correct theoretical amount of welfare change. In a recent paper, Robert Willig derives bounds for the percentage difference between the correct measure of either the compensating or equivalent variation and the Marshallian measure derived form the market demand curve. His bounds, which depend on the income elasticity of demand for the single good in the region of price change being considered as well as the proportion of the consumer's income spent on the good, demonstrate that the Marshallian consumer's surplus is often a good approximation to Hicks' consumer's surplus. The fact that the proportion of the consumer's income spent matters as well as the income elasticity was first pointed out by Harold Hotelling. Willig contends that the approximation error will be less than the errors involved in estimating the demand curve. Thus he hopes to remove the need for apology that applied economists often need to give to theorists who remark on the inappropriateness of using Marshallian consumer's surplus to measure welfare change. However, in this paper I show that for the case primarily considered by Willig of a single price change, which is also the situation in which consumer's surplus is often used in applied work, no approximation is necessary. *Professor of economics, Massachusetts Institute of Technology, and research associate, National Bureau of Economic Research. I would like to thank Peter Diamond, Erwin Diewert, Daniel McFadden, Robert Merton, Robert Solow, Hal Varian, Joel Yellin, and the referees for help and comments. Research support from the National Science Foundation is acknowledged. 'The reason that we still have two, rather than one, of Samuelson's six measures of consumer's surplus arises from an index number problem of the correct basis for the welfare comparison. I will give both measures but plan to concentrate on the compensating variation.
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nonparametric estimation of exact consumers surplus and Deadweight loss
Econometrica, 1995Co-Authors: Jerry A Hausman, Whitney K NeweyAbstract:We apply nonparametric regression models to estimation of demand curves of the type most often used in applied research. From the demand curve estimators we derive estimates of exact consumers surplus and Deadweight loss, which are the most widely used welfare and economic efficiency measures in areas of economics such as public finance. We also develop tests of the symmetry and downward sloping properties of compensated demand. We work out asymptotic normal sampling theory for kernel and series nonparametric estimators, as well as for the parametric case. The paper includes an application to gasoline demand. Empirical questions of interest here are the shape of the demand curve and the average magnitude of welfare loss from a tax on gasoline. In this application we compare parametric and nonparametric estimates of the demand curve, calculate exact and approximate measures of consumers surplus and Deadweight loss, and give standard error estimates. We also analyze the sensitivity of the welfare measures to components of nonparametric regression estimators such as the number of terms in a series approximation.
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nonparametric estimation of exact consumers surplus and Deadweight loss
Econometrica, 1995Co-Authors: Jerry A Hausman, Whitney K NeweyAbstract:The authors apply nonparametric regression models to estimation of demand curves of the type most often used in applied research. From the demand curve estimators they derive estimates of exact consumers surplus and Deadweight loss. The authors also develop tests of the symmetry and downward sloping properties of compensated demand. They work out asymptotic normal sampling theory for kernel and series nonparametric estimators as well as for the parametric case. The paper includes an application to gasoline demand that estimates the shape of the demand curve and the average magnitude of welfare loss from a tax on gasoline. Copyright 1995 by The Econometric Society.
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nonparametric estimation of exact consumers surplus and Deadweight loss
Research Papers in Economics, 1992Co-Authors: Jerry A Hausman, Whitney K NeweyAbstract:The authors apply nonparametric regression models to estimation of demand curves of the type most often used in applied research. From the demand curve estimators they derive estimates of exact consumers surplus and Deadweight loss. The authors also develop tests of the symmetry and downward sloping properties of compensated demand. They work out asymptotic normal sampling theory for kernel and series nonparametric estimators as well as for the parametric case. The paper includes an application to gasoline demand that estimates the shape of the demand curve and the average magnitude of welfare loss from a tax on gasoline. Copyright 1995 by The Econometric Society.(This abstract was borrowed from another version of this item.)
Whitney K Newey - One of the best experts on this subject based on the ideXlab platform.
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nonparametric estimation of exact consumers surplus and Deadweight loss
Econometrica, 1995Co-Authors: Jerry A Hausman, Whitney K NeweyAbstract:We apply nonparametric regression models to estimation of demand curves of the type most often used in applied research. From the demand curve estimators we derive estimates of exact consumers surplus and Deadweight loss, which are the most widely used welfare and economic efficiency measures in areas of economics such as public finance. We also develop tests of the symmetry and downward sloping properties of compensated demand. We work out asymptotic normal sampling theory for kernel and series nonparametric estimators, as well as for the parametric case. The paper includes an application to gasoline demand. Empirical questions of interest here are the shape of the demand curve and the average magnitude of welfare loss from a tax on gasoline. In this application we compare parametric and nonparametric estimates of the demand curve, calculate exact and approximate measures of consumers surplus and Deadweight loss, and give standard error estimates. We also analyze the sensitivity of the welfare measures to components of nonparametric regression estimators such as the number of terms in a series approximation.
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nonparametric estimation of exact consumers surplus and Deadweight loss
Econometrica, 1995Co-Authors: Jerry A Hausman, Whitney K NeweyAbstract:The authors apply nonparametric regression models to estimation of demand curves of the type most often used in applied research. From the demand curve estimators they derive estimates of exact consumers surplus and Deadweight loss. The authors also develop tests of the symmetry and downward sloping properties of compensated demand. They work out asymptotic normal sampling theory for kernel and series nonparametric estimators as well as for the parametric case. The paper includes an application to gasoline demand that estimates the shape of the demand curve and the average magnitude of welfare loss from a tax on gasoline. Copyright 1995 by The Econometric Society.
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nonparametric estimation of exact consumers surplus and Deadweight loss
Research Papers in Economics, 1992Co-Authors: Jerry A Hausman, Whitney K NeweyAbstract:The authors apply nonparametric regression models to estimation of demand curves of the type most often used in applied research. From the demand curve estimators they derive estimates of exact consumers surplus and Deadweight loss. The authors also develop tests of the symmetry and downward sloping properties of compensated demand. They work out asymptotic normal sampling theory for kernel and series nonparametric estimators as well as for the parametric case. The paper includes an application to gasoline demand that estimates the shape of the demand curve and the average magnitude of welfare loss from a tax on gasoline. Copyright 1995 by The Econometric Society.(This abstract was borrowed from another version of this item.)
Simon Quach - One of the best experts on this subject based on the ideXlab platform.
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are sufficient statistics necessary nonparametric measurement of Deadweight loss from unemployment insurance
Journal of Labor Economics, 2021Co-Authors: David S Lee, Pauline Leung, Christopher J Oleary, Zhuan Pei, Simon QuachAbstract:Central to the welfare analysis of income transfer programs is the Deadweight loss associated with possible reforms. To aid analytical tractability, its measurement typically requires specifying a ...
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are sufficient statistics necessary nonparametric measurement of Deadweight loss from unemployment insurance
National Bureau of Economic Research, 2019Co-Authors: David S Lee, Pauline Leung, Christopher J Oleary, Zhuan Pei, Simon QuachAbstract:Central to the welfare analysis of income transfer programs is the Deadweight loss associated with possible reforms. To aid analytical tractability, its measurement typically requires specifying a simplified model of behavior. We employ a complementary "decomposition" approach that compares the behavioral and mechanical components of a policy's total impact on the government budget to study the Deadweight loss of two unemployment insurance policies. Experimental and quasi-experimental estimates using state administrative data show that increasing the weekly benefit is more efficient (with a fiscal externality of 53 cents per dollar of mechanical transferred income) than reducing the program's implicit earnings tax.
Daeim Kang - One of the best experts on this subject based on the ideXlab platform.
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reduction of Deadweight pendulum motion and its conformation by using a build up system
Journal of Mechanical Science and Technology, 2009Co-Authors: Yonkyu Park, Daeim Kang, Jongho Kim, Min Seok KimAbstract:Deadweight force machines cause oscillating components strongly related to the pendulum motion of the Deadweight in the measured force signals. An estimating method of the pendulum motion using a build-up system has been proposed in previous papers. In this paper, the estimation algorithm was confirmed by comparison with the directly measured trajectory through the analysis of a 500 kN Deadweight force standard machine in Korea Research Institute of Standards and Science. After the dynamic analysis of the force machine, it was modified to decrease the pendulum motion effects by accurately controlling its loading speed. As a result of the modification, the oscillating level due to the dynamic behavior of the force machine has been reduced considerably.
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the influence of loading frame stiffness on loadcell Deadweight force machine interaction
Measurement, 2009Co-Authors: A Abusinna, Yonkyu Park, Daeim KangAbstract:Abstract We have investigated the effect of the loading frame stiffness on the Deadweight force machine–loadcell interaction. We examined the influence of four of the loading frame’s dimensional variables, specifically the upper plate thickness, span width, loading frame height, and column diameter. Finite element analysis illustrates that the upper plate thickness is the most important of these four factors. In order to perform the finite element analysis efficiently, we utilized the Taguchi technique, as this typically reduces the total required simulations. The validity of the finite element analysis was confirmed through experiments. Further investigation of the effects of the upper plate thickness showed the degree of interaction initially decreases with increasing thickness, but then levels off. The onset of constant interaction is a useful guide for the design of a Deadweight force machine, because it can provide optimal thickness to satisfy both the high stiffness and small weight simultaneously.
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development of a small capacity Deadweight torque standard machine
Measurement Science and Technology, 2007Co-Authors: Yonkyu Park, Min Seok Kim, Daeim KangAbstract:The Korea Research Institute of Standards and Science (KRISS) has developed a 100 N m Deadweight torque standard machine. The machine consists of a torque arm, an air bearing, six weight stacks, a main body and a control system. It can be operated almost fully automatically. The machine can generate torque from 0.1 N m to 110 N m with a relative expanded uncertainty of 5.0 × 10−4 for 0.1 N m to 1 N m and 5.0 × 10−5 for 1 N m to 110 N m. The machine was compared with a 2 kN m Deadweight torque machine. In the comparison, the relative deviation was less than 5 × 10−5, the declared expanded uncertainty of the torque standard machines, and therefore we confirmed the accuracy of the machine.
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100 kn Deadweight force standard machine and evaluation
Journal of Mechanical Science and Technology, 2006Co-Authors: Yonkyu Park, Daeim Kang, Min Seok Kim, Jongho Kim, Houkeun SongAbstract:A Deadweight force standard machine is a mechanical structure that generates force by subjecting Deadweights to the local gravitational field. The Korea Research Institute of Standards and Science (KRISS) developed and installed a 100 kN Deadweight force standard machine for national force standards. It can generate forces from 2 kN to 110 kN in increments of 1 kN. The uncertainty of the force machine was estimated and declared as 2 × 10−5. This 100 kN Deadweight force machine was compared with the 500 kN Deadweight force standard machine at KRISS and the 20 kN and 50 kN Deadweight force standard machines at the National Metrology Institute of Japan (NMIJ). The measurement results showed good agreement between the Deadweight force machines, and the accuracy level of the 100 kN Deadweight force machine was verified.
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pendulum motion of a Deadweight force standard machine
Measurement Science and Technology, 2000Co-Authors: Yonkyu Park, Daeim KangAbstract:When a build-up system is placed into a Deadweight force-standard machine, the signals from the force transducers contain oscillation components that reflect the dynamic behaviour of the force machine. The Deadweight force-standard machine of 100 kN at the Korea Research Institute of Standards and Science (KRISS) causes oscillations with component frequencies of about 0.28 Hz. These are strongly related to the pendulum motion of the Deadweights. This paper describes the behaviour of the Deadweights in detail. The oscillation frequency, as well as the trajectory of the pendulum motion, is investigated. Some signal-processing methods that are designed to estimate the dynamic behaviour of the Deadweights, by using the force signals from the build-up system, are proposed. The relative uncertainty due to the motion of the Deadweight is estimated. This paper also deals with a modification of the Deadweight force machine that is designed to reduce its pendulum motion significantly.
Yonkyu Park - One of the best experts on this subject based on the ideXlab platform.
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small capacity Deadweight force standard machine compensating loading frame
Measurement, 2012Co-Authors: Yonkyu Park, Houkeun Song, Hoyoung Lee, Min Seok KimAbstract:Abstract The Korea Research Institute of Standards and Science (KRISS) has developed a 20 N Deadweight force standard machine. The machine consists of a weight stack, a loading frame, a taring system, a main body and a control system. The taring system has the role of compensating the initial force generated by the loading frame. With two motors, a displacement sensor, several limit switches, and a synthetic control system consisting of a programmable logic controller and an operating PC, the machine can be operated almost fully automatically. The machine can generate a compressive force in the range of 0.5–22 N with a relative expanded uncertainty of 1.0 × 10 –4 . The machine was compared with a 200 N Deadweight force standard machine. In the comparison, the relative deviation was 5.8 × 10 –5 , less than the declared expanded uncertainty of the force standard machines, therefore confirming the machine’s accuracy.
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reduction of Deadweight pendulum motion and its conformation by using a build up system
Journal of Mechanical Science and Technology, 2009Co-Authors: Yonkyu Park, Daeim Kang, Jongho Kim, Min Seok KimAbstract:Deadweight force machines cause oscillating components strongly related to the pendulum motion of the Deadweight in the measured force signals. An estimating method of the pendulum motion using a build-up system has been proposed in previous papers. In this paper, the estimation algorithm was confirmed by comparison with the directly measured trajectory through the analysis of a 500 kN Deadweight force standard machine in Korea Research Institute of Standards and Science. After the dynamic analysis of the force machine, it was modified to decrease the pendulum motion effects by accurately controlling its loading speed. As a result of the modification, the oscillating level due to the dynamic behavior of the force machine has been reduced considerably.
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the influence of loading frame stiffness on loadcell Deadweight force machine interaction
Measurement, 2009Co-Authors: A Abusinna, Yonkyu Park, Daeim KangAbstract:Abstract We have investigated the effect of the loading frame stiffness on the Deadweight force machine–loadcell interaction. We examined the influence of four of the loading frame’s dimensional variables, specifically the upper plate thickness, span width, loading frame height, and column diameter. Finite element analysis illustrates that the upper plate thickness is the most important of these four factors. In order to perform the finite element analysis efficiently, we utilized the Taguchi technique, as this typically reduces the total required simulations. The validity of the finite element analysis was confirmed through experiments. Further investigation of the effects of the upper plate thickness showed the degree of interaction initially decreases with increasing thickness, but then levels off. The onset of constant interaction is a useful guide for the design of a Deadweight force machine, because it can provide optimal thickness to satisfy both the high stiffness and small weight simultaneously.
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development of a small capacity Deadweight torque standard machine
Measurement Science and Technology, 2007Co-Authors: Yonkyu Park, Min Seok Kim, Daeim KangAbstract:The Korea Research Institute of Standards and Science (KRISS) has developed a 100 N m Deadweight torque standard machine. The machine consists of a torque arm, an air bearing, six weight stacks, a main body and a control system. It can be operated almost fully automatically. The machine can generate torque from 0.1 N m to 110 N m with a relative expanded uncertainty of 5.0 × 10−4 for 0.1 N m to 1 N m and 5.0 × 10−5 for 1 N m to 110 N m. The machine was compared with a 2 kN m Deadweight torque machine. In the comparison, the relative deviation was less than 5 × 10−5, the declared expanded uncertainty of the torque standard machines, and therefore we confirmed the accuracy of the machine.
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100 kn Deadweight force standard machine and evaluation
Journal of Mechanical Science and Technology, 2006Co-Authors: Yonkyu Park, Daeim Kang, Min Seok Kim, Jongho Kim, Houkeun SongAbstract:A Deadweight force standard machine is a mechanical structure that generates force by subjecting Deadweights to the local gravitational field. The Korea Research Institute of Standards and Science (KRISS) developed and installed a 100 kN Deadweight force standard machine for national force standards. It can generate forces from 2 kN to 110 kN in increments of 1 kN. The uncertainty of the force machine was estimated and declared as 2 × 10−5. This 100 kN Deadweight force machine was compared with the 500 kN Deadweight force standard machine at KRISS and the 20 kN and 50 kN Deadweight force standard machines at the National Metrology Institute of Japan (NMIJ). The measurement results showed good agreement between the Deadweight force machines, and the accuracy level of the 100 kN Deadweight force machine was verified.