CES-class: Class "CES"

Description Objects from the Class Slots Extends Methods Author(s) Examples


The “CES” class contains all the information needed to calibrate a CES demand system and perform a merger analysis under the assumption that firms are playing a differentiated Bertrand pricing game.

Objects from the Class

Objects can be created by using the constructor function ces.


Let k denote the number of products produced by all firms.


A list containing the coefficient on the numeraire (‘alpha’), the coefficient on price (‘gamma’), and the vector of mean valuations (‘meanval’)


The price of the outside good. Default is 1.


Class Logit, directly. Class Bertrand, by class Logit, distance 2. Class Antitrust, by class Bertrand, distance 3.


For all of methods containing the ‘preMerger’ argument, ‘preMerger’ takes on a value of TRUE or FALSE, where TRUE invokes the method using the pre-merger ownership structure, while FALSE invokes the method using the post-merger ownership structure.


signature(object, preMerger = TRUE,revenue=FALSE)

Compute either pre-merger or post-merger equilibrium revenue shares under the assumptions that consumer demand is CES and firms play a differentiated product Bertrand Nash pricing game. ‘revenue’ takes on a value of TRUE or FALSE, where TRUE calculates revenue shares, while FALSE calculates quantity shares.



Uncover CES demand parameters. Assumes that firms are currently at equilibrium in a differentiated product Bertrand Nash pricing game.


signature(object, revenueInside)

Calculates compensating variation. If ‘revenueInside’ is missing, then CV returns compensating variation as a percent of the representative consumer's income. If ‘revenueInside’ equals the total expenditure on all products inside the market, then CV returns compensating variation in levels.


signature(object, preMerger = TRUE)

Computes a k x k matrix of own and cross-price elasticities.


Charles Taragin charles.taragin@usdoj.gov


showClass("CES")           # get a detailed description of the class
showMethods(classes="CES") # show all methods defined for the class

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