snqProfitEla {micEcon} | R Documentation |
Calculates the Price Elasticities of a Symmetric Normalized Quadratic (SNQ) profit function.
snqProfitEla( beta, prices, quant, weights )
beta |
matrix of estimated β coefficients. |
prices |
vector of netput prices at which the elasticities should be calculated. |
quant |
vector of netput quantities at which the elasticities should be calculated. |
weights |
vector of weights of prices used for normalization. |
A price elasticity is defined as
E_{ij} = frac{ displaystyle frac{ partial q_i }{ q_i } } { displaystyle frac{ partial p_j }{ p_j } } = frac{ partial q_i }{ partial p_j } cdot frac{ p_j }{ q_i }
Thus, e.g. E_{ij}=0.5 means that if the price of netput j (p_j) increases by 1%, the quantity of netput i (q_i) will increase by 0.5%.
Arne Henningsen ahenningsen@agric-econ.uni-kiel.de
# just a stupid simple example snqProfitEla( matrix(101:109,3,3), c(1,1,1), c(1,-1,-1), c(0.4,0.3,0.3) ) # now with real data data( germanFarms ) germanFarms$qOutput <- germanFarms$vOutput / germanFarms$pOutput germanFarms$qVarInput <- -germanFarms$vVarInput / germanFarms$pVarInput germanFarms$qLabor <- -germanFarms$qLabor germanFarms$time <- c( 0:19 ) pNames <- c( "pOutput", "pVarInput", "pLabor" ) qNames <- c( "qOutput", "qVarInput", "qLabor" ) estResult <- snqProfitEst( pNames, qNames, c("land","time"), data=germanFarms ) estResult$ela # price elasticities at mean prices and mean quantities # price elasticities at the last observation (1994/95) snqProfitEla( estResult$coef$beta, estResult$estData[ 20, pNames ], estResult$estData[ 20, qNames ], estResult$weights )