Effects of Price Shocks on Consumer Demand: Estimating the QUAIDS Demand System on Czech Household Budget Survey Data
Journal Title: Finance a uver - Year 2014, Vol 64, Issue 6
Abstract
The purpose of this paper is to provide estimates of price and income elasticities of Czech consumer demand, which can be used when analyzing the impact of exogenous price changes on consumer behavior. We estimate a demand system in which demand depends on income, prices and other socio-economic household characteristics. We combine the Household Budget Survey data with information on prices from alternative sources between 2000 and 2008. Based on our estimates, the commodity bundles of food, energy, and health and body care are necessary goods, as their budget elasticity is positive and below one. Clothing, transportation, education and leisure are luxury goods, with income elasticity above one. We found expenditure on energy and transportation and communication to be the most elastic in their own prices. We use our estimates to analyze the impact of regulated price changes on consumer demand and discuss the further potential use of our results.
Authors and Affiliations
Kamil Dybczak, Peter Toth, David Vonka
Keywords
Related Articles
- EP ID EP297486
- DOI -
- Views 150
- Downloads 0
Successful Crowdfunding Campaigns: The Role of Project Specifics, Competition and Founders’ Experience
We focus on reward-based crowdfunding and identify the basic determinants of successful crowdfunding campaigns including new determinants not analyzed in previous studies. Using a rich database of Kickstarter projects la...
Exchange Rate Pass-Through in Central and Eastern Europe: A Panel Bayesian VAR Approach
In this paper we estimate average and individual countries’ exchange rate pass-through to producer and consumer price indices in four Central and Eastern Europe countries (Romania, the Czech Republic, Hungary and Poland)...
Firm-Level and Institutional Determinants of Corporate Capital Structure in Poland: New Evidence from the Warsaw Stock Exchange
This paper discusses how well major capital structure theories incorporate firm-level and institutional factors into short-term firm financing decisions in a specific context, that of a transition economy. Using a new da...
Effectiveness of Portfolio Diversification and the Dynamic Relationship between Stock and Currency Markets in the Emerging Eastern European and Russian Markets
This study investigates volatility spillovers and the dynamic relationship between the stock and currency markets in the Czech Republic, Poland, Hungary and Russia using four multivariate GARCH models. We analyze the opt...
An Exchange Rate Floor as an Instrument of Monetary Policy: An Ex-Post Assessment of the Czech Experience
In November 2013 the Czech National Bank introduced a floor for the Czech koruna exchange rate as its monetary policy instrument. The rationale for this action was to prevent the risk of deflation in a zero-lower-bound e...