translogCheckMono: Monotonicity of a Translog Function

In micEcon: Microeconomic Analysis and Modelling

Description

Check monotonicity of a translog function.

Usage

translogCheckMono( xNames, data, coef, increasing = TRUE,
   strict = FALSE, dataLogged = FALSE,
   tol = 10 * .Machine$double.eps )

## S3 method for class 'translogCheckMono'
print( x, ... )

## S3 method for class 'translogCheckMono'
summary( object, ... )

## S3 method for class 'summary.translogCheckMono'
print( x, ... )

Arguments

xNames	a vector of strings containing the names of the independent variables.
data	dataframe containing the data.
coef	vector containing all coefficients.
increasing	single logical value or vector of logical values of the same length as argument xNames indicating whether it should be checked if the translog function is monotonically increasing (default, TRUE) or decreasing (FALSE) in the explanatory variables.
strict	logical. Check for strict (TRUE) or non-strict (default, FALSE) monotonicity?
dataLogged	logical. Are the values in data already logged?
tol	tolerance level for checking non-strict monotonicity: values between -tol and tol are considered to be zero (ignored if argument strict is TRUE).
x	an object returned by translogCheckMono or by summary.translogCheckMono.
object	an object returned by translogCheckMono.
...	currently not used.

Details

Function translogCheckMono internally calls function translogDeriv and then checks if the derivatives have the sign specified in argument increasing.

Function translogCheckMono does not have an argument shifterNames, because shifter variables do not affect the monotonicity conditions of the eplanatory variables defined in Argument xNames. Therefore, translogCheckMono automatically removes all coefficients of the shifter variables before it calls translogDeriv.

Value

translogCheckMono returns a list of class translogCheckMono containing following objects:

obs	a vector indicating whether monotonicity is fulfilled at each observation.
exog	data frame indicating whether monotonicity is fulfilled for each exogenous variable at each observation.
increasing	argument increasing.
strict	argument strict.

Author(s)

Arne Henningsen

See Also

translogEst, translogDeriv, and translogCheckCurvature

Examples

   data( germanFarms )
   # output quantity:
   germanFarms$qOutput <- germanFarms$vOutput / germanFarms$pOutput
   # quantity of variable inputs
   germanFarms$qVarInput <- germanFarms$vVarInput / germanFarms$pVarInput
   # a time trend to account for technical progress:
   germanFarms$time <- c(1:20)

   # estimate a translog production function
   estResult <- translogEst( "qOutput", c( "qLabor", "land", "qVarInput", "time" ),
      germanFarms )

   # check whether the production function is monotonically increasing
   # in all inputs
   test <- translogCheckMono( xNames = c( "qLabor", "land", "qVarInput", "time" ),
      data = germanFarms, coef = coef( estResult ) )
   test
   summary( test )

   # check whether the production function is monotonically decreasing
   # in time and monotonically increasing in all other inputs
   test <- translogCheckMono( c( "qLabor", "land", "qVarInput", "time" ),
      germanFarms, coef( estResult ), increasing = c( TRUE, TRUE, TRUE, FALSE ) )
   test
   summary( test )

Example output

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This translog function is monotonically increasing in qLabor, land, qVarInput, time at 1 out of 20 observations (5%)
This translog function is monotonically increasing in qLabor, land, qVarInput, time at 1 out of 20 observations (5%)
The monotonicity condition for the exogenous variable
- 'qLabor' is fulfilled at 14 out of 20 observations (70%)
- 'land' is fulfilled at 20 out of 20 observations (100%)
- 'qVarInput' is fulfilled at 11 out of 20 observations (55%)
- 'time' is fulfilled at 7 out of 20 observations (35%)
This translog function is monotonically increasing in qLabor, land, qVarInput and monotonically decreasing in time at 7 out of 20 observations (35%)
This translog function is monotonically increasing in qLabor, land, qVarInput and monotonically decreasing in time at 7 out of 20 observations (35%)
The monotonicity condition for the exogenous variable
- 'qLabor' is fulfilled at 14 out of 20 observations (70%)
- 'land' is fulfilled at 20 out of 20 observations (100%)
- 'qVarInput' is fulfilled at 11 out of 20 observations (55%)
- 'time' is fulfilled at 13 out of 20 observations (65%)

micEcon documentation built on Jan. 7, 2021, 3:01 p.m.