Description Usage Arguments Value Note Author(s) See Also Examples

Calculates the Price Elasticities of a Symmetric Normalized Quadratic (SNQ) profit function.

1 2 3 |

`beta` |
matrix of estimated |

`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. |

`scalingFactors` |
factors to scale prices (and quantities). |

`coefVcov` |
variance covariance matrix of the coefficients (optional). |

`df` |
degrees of freedom to calculate P-values of the elasticities (optional). |

a list of class `snqProfitEla`

containing following elements:

`ela` |
matrix of the price elasticities. |

`vcov` |
variance covariance matrix of the price elasticities. |

`stEr` |
standard errors of the price elasticities. |

`tval` |
t-values of the price elasticities. |

`pval` |
P-values of the price elasticities. |

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

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 | ```
# 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, package = "micEcon" )
germanFarms$qOutput <- germanFarms$vOutput / germanFarms$pOutput
germanFarms$qVarInput <- -germanFarms$vVarInput / germanFarms$pVarInput
germanFarms$qLabor <- -germanFarms$qLabor
germanFarms$time <- c( 0:19 )
priceNames <- c( "pOutput", "pVarInput", "pLabor" )
quantNames <- c( "qOutput", "qVarInput", "qLabor" )
estResult <- snqProfitEst( priceNames, quantNames, c("land","time"), data=germanFarms )
estResult$ela # price elasticities at mean prices and mean quantities
# price elasticities at the last observation (1994/95)
snqProfitEla( estResult$coef$beta, estResult$data[ 20, priceNames ],
estResult$data[ 20, quantNames ], estResult$weights,
estResult$scalingFactors )
``` |

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