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Notes on Displaced CES Functional Forms

Date post: 13-Sep-2015
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This document shows how to add another parameter to a Constant Elasticity of Substitution (CES) utility function, derive demand functions, and solve for indirect utility and expenditure functions for the evaluation of money metric utility welfare changes from a price or tax change. It also shows how to calibrate the model, by solving backwards for the parameters that must have existed to generate the observed data.KEYWORDS: economics, computation, general equilibrium, welfare
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  • CES1-12crop.pdfCES1.pdfCES2-12.pdf

    CES13-24crop.pdf

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