# Questions tagged [elasticity]

In economics, a measure of the sensitivity or responsiveness of a variable corresponding to a change in another variable. Common applications in empirical research include price or income elasticity of demand. For example, what is the percent change in quantity demanded for gasoline when price is increased by 1%?

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### Using results of log-log regression for forecasting

If I have a regression in with logs taken of both sides to give the equation: $ln(y) = \beta_0 + \beta_1 ln(x)$ and need to calculate the expected change in $y$ for a given $x$. I can see from reading ...
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### Derive elasticities from partial dependences

I am producing a partial dependences plot based on a random forests (RF) binary classification model, which yields predicted probabilty of observation $i$ belong to class A for the outcome variable Z. ...
1 vote
28 views

### log log model to estimate elasticities for 0 demand/dependent variable

Many of you will be familiar with the use of the log log linear regression model to estimate elasticity. I am in this situation where I can get zero demand, the dependent variable, which obviously ...
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1 vote
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### Multiplicative BIASES in Log-Log regression

When we try to estimate elasticities by regression, we usually estimate the following regression model: $$ln(y) = \beta_0 + \beta_1 ln(x_1) + \dots + \epsilon$$ When we expect to have endogenous ...
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### Moving average vs. lagged dependent variable in pass-through regressions

I am estimating a pass-through elasticity of the basic form: ln(cost) = alpha + ln(price) + controls + error My issue is that the price charged in period t may be associated with a product purchased ...
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### interpretation of loglog regression

It is common econometric disciplines to model an baseline + incremental quantity due to treatment. E.g baseline sales + incremental sales(due to marketing). It is common to deploy loglog models to ...
1 vote
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### How to get price- and cross-price elasticities using household survey data

How does one estimate price-elasticity and cross-price elasticity using cross-sectional household survey data? Note that household survey data usually do not include price information. The literature ...
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1 vote
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### Elasticity estimates for zero-truncated negative binomial part in the hurdle model

I estimated a hurdle negative binomial regression model with zero-truncated negative binomial model as the count component in R using the pscl package. I wish to present elasticities for the count ...
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1 vote
87 views

### Interpretation of results of a regression analysis

Here're the results of a multi-variable regression analysis run by Stata to test the effects of the three factors on the price elasticity of supply, which is the dependent variable. The coefficients ...
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1 vote
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### pooled cross section data

I want to find input demand elasticities using a cost function. Input quantities and input prices are available for individual farmers for 5 food crops and 5 years (2015-2019). But farmers may vary ...
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1 vote
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### How can I estimate differences between groups with pseudo-panel data?

I am working with pseudo-panel data (UK Cost of Living and Food Survey), which means I am observing expenditure data for different households every month over ~10 years with data on demographic ...
1 vote
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### "Inverting back" the inverted supply equation in an ECM. Possible?

I am estimating a time series 2SLS, ECM model, for electricity consumption. The system has a demand equation: The price is endogenous in the demand equation, and therefore, I also estimate a price ...
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262 views

### Price elasticity of demand estimation with single store level data

I have weekly data per single SKU and for more than 500 point of sales. Data embeds base price, quanity sold, holidays, temperature, market activities (cut-price, display, leaflets) and so on. I want ...
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### ECM long-run elasticity with one I(2) variable

I am estimating a 2SLS using a time series simultaneous equation ECM. The purpose is to estimate the price elasticity of electricity demand. Assume that both price and demand are I(1) variables, ...
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28 views

### Power demand Curves

Which is the correct way to compute the elasticity in this log log regression? Context: When having an log log regresion: log(Y) = log(B0) + B1 log(X), being Y= Demand and X Price, B0 intercept and B1 ...
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1k views

### How do we make predictions for future data when you have lagged dependent features used in training?

I am executing a lightGBM model to forecast my units sold (qty) over a period of time. Objective is to run a model for each product group and be able to capture the trends, price elasticity, etc and ...
87 views

### Should I use regularization in a price elasticity model?

I am building a price elasticity model using linear regression: log(demand) ~ 1 + log(price) + ... Does it make sense to use L1 and/or L2 regularization to prevent ...
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### Accuracy of coefficients on log-linear regressiosn

Consider the following two regression models using data from the table below. $ln(wage)=\beta_0+\beta_1 female+u$ $ln(wage)=\gamma _0+\gamma_1 male+v$ wage female male 10 1 0 20 1 0 30 1 0 40 1 ...
1 vote
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### Elasticity Panel Data

I have a dataset like this: Fileds Profit x Product: It is the variable that I can change, and is the independent variable. ...
83 views

### Finding Elasticity of Discount with Consumers

I was wondering what the best method to go about this would be. I have one year's worth of data and its related to air-travel. So I have ticket fares, passengers sent, discount applied on each ticket ...