Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/128661
Authors: 
Kratena, Kurt
Wüger, Michael
Year of Publication: 
1998
Series/Report no.: 
WIFO Working Papers 105
Abstract: 
This paper deals with the regularity problem in the Almost Ideal Demand System (AIDS) in terms of the boundedness of the budget shares within the [0,1] interval. The violation of "cointegration accounting" can be seen just as another consequence of irregularity. The discussion of modifications in the PIGLOG cost functions leads to the proposition of a modified dynamic PIGLOG formulation, from which a system of budget shares can be derived, which ensures regularity and validity of "cointegration accounting". A special feature of the resulting share equations is the divergence from the time path of the AIDS shares over time.
Subjects: 
AIDS mode
PIGLOG specification
cointegration
JEL: 
D11
D12
C30
C32
Document Type: 
Working Paper

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