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Kenneth W. Clements

Bio: Kenneth W. Clements is an academic researcher from University of Western Australia. The author has contributed to research in topics: Consumption (economics) & Relative price. The author has an hindex of 30, co-authored 201 publications receiving 2832 citations. Previous affiliations of Kenneth W. Clements include University of New South Wales & University of Chicago.


Papers
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Journal ArticleDOI
TL;DR: In this article, the authors use the consumption of beer, wine, and spirits to illustrate how the systemwide approach to consumer demand can be extended so that it can be applied to narrowly defined commodity groups.
Abstract: The systemwide approach to the analysis of consumer demand considers the multivariate structure of the problem in which the consumer allocates his income to all goods simultaneously. This approach combines the theory of the consumer with empirical analysis and has enjoyed much popularity over the past decade. For surveys of these developments, see Brown and Deaton (1972), Phlips (1974), Powell (1974), Theil (1975-76, 1980), Barten (1977), and Theil and Clements (1980). Most previous applications of the systemwide approach have used national accounts commodity groups (food, clothing, housing, and so on). For many business and government policy purposes, however, these groups are much too broad. For example, to analyze the effects on consumption of all but the simplest changes in indirect taxes, we would need considerably more disaggregation. Similarly, market researchers need to analyze demand at the individual product level for purposes of forecasting and formulating pricing and other policies. The objective of this paper is to use the consumption of beer, wine, and spirits to illustrate how the approach can be apThis paper illustrates how the systemwide approach to consumer demand can be extended so that it can be applied to narrowly defined commodity groups. We use the consumption of beer, wine, and spirits to show how the approach can be applied to estimate income and price elasticities of demand. When the consumer's utility function is appropriately separable in alcoholic beverages and all other goods, it is possible to confine our attention to the three beverages and ignore all other goods. We use the demand model for a number of simulations designed to analyze the rapid growth of wine consumption. * We are indebted to John Davis, Peter Goldschmidt, and Kal Stening for excellent research assistance, to Michael Wohlgenant and Henri Theil for helpful comments and discussion, and to the New South Wales Drug and Alcohol Authority for their partial financial support of this research.

122 citations

Posted Content
TL;DR: In this article, the authors use the consumption of beer, wine, and spirits to illustrate how the systemwide approach to consumer demand can be extended so that it can be applied to narrowly defined commodity groups.
Abstract: The systemwide approach to the analysis of consumer demand considers the multivariate structure of the problem in which the consumer allocates his income to all goods simultaneously. This approach combines the theory of the consumer with empirical analysis and has enjoyed much popularity over the past decade. For surveys of these developments, see Brown and Deaton (1972), Phlips (1974), Powell (1974), Theil (1975-76, 1980), Barten (1977), and Theil and Clements (1980). Most previous applications of the systemwide approach have used national accounts commodity groups (food, clothing, housing, and so on). For many business and government policy purposes, however, these groups are much too broad. For example, to analyze the effects on consumption of all but the simplest changes in indirect taxes, we would need considerably more disaggregation. Similarly, market researchers need to analyze demand at the individual product level for purposes of forecasting and formulating pricing and other policies. The objective of this paper is to use the consumption of beer, wine, and spirits to illustrate how the approach can be apThis paper illustrates how the systemwide approach to consumer demand can be extended so that it can be applied to narrowly defined commodity groups. We use the consumption of beer, wine, and spirits to show how the approach can be applied to estimate income and price elasticities of demand. When the consumer's utility function is appropriately separable in alcoholic beverages and all other goods, it is possible to confine our attention to the three beverages and ignore all other goods. We use the demand model for a number of simulations designed to analyze the rapid growth of wine consumption. * We are indebted to John Davis, Peter Goldschmidt, and Kal Stening for excellent research assistance, to Michael Wohlgenant and Henri Theil for helpful comments and discussion, and to the New South Wales Drug and Alcohol Authority for their partial financial support of this research.

122 citations

Journal ArticleDOI
TL;DR: The stochastic approach to index number theory views each commodity price change as an independent observation on the underlying rate of inflation so that inflation can be estimated by averaging over all the prices as mentioned in this paper.
Abstract: The stochastic approach to index number theory views each commodity price change as an independent observation on the underlying rate of inflation so that inflation can be estimated by averaging over all the prices. This article extends the approach by (a) allowing for sustained changes in relative prices, (b) showing the link with Divisia index numbers, and (c) deriving standard errors for the inflation estimates. The results are illustrated with Australian data.

104 citations

Journal ArticleDOI
TL;DR: In this paper, the authors investigated the impact of mining exploration on the WA Department of Industry and Resources (DoI&R) and the Australian National Audit Office (AOPIO).

84 citations


Cited by
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Journal ArticleDOI
TL;DR: It is impossible that the rulers now on earth should make any benefit, or derive any the least shadow of authority from that, which is held to be the fountain of all power, Adam's private dominion and paternal jurisdiction.
Abstract: All these premises having, as I think, been clearly made out, it is impossible that the rulers now on earth should make any benefit, or derive any the least shadow of authority from that, which is held to be the fountain of all power, Adam's private dominion and paternal jurisdiction; so that he that will not give just occasion to think that all government in the world is the product only of force and violence, and that men live together by no other rules but that of beasts, where the strongest carries it, and so lay a foundation for perpetual disorder and mischief, tumult, sedition and rebellion, (things that the followers of that hypothesis so loudly cry out against) must of necessity find out another rise of government, another original of political power, and another way of designing and knowing the persons that have it, than what Sir Robert Filmer hath taught us.

3,076 citations

Journal ArticleDOI
TL;DR: In this article, the authors examined the hypothesis that the expected rate of return to speculation in the forward foreign exchange market is zero; that is, the logarithm of the forward exchange rate is the market's conditional expectation of the future spot rate, and they were able to reject the simple market efficiency hypothesis for exchange rates from the 1970s and the 1920s.
Abstract: This paper examines the hypothesis that the expected rate of return to speculation in the forward foreign exchange market is zero; that is, the logarithm of the forward exchange rate is the market's conditional expectation of the logarithm of the future spot rate. A new computationally tractable econometric methodology for examining restrictions on a k-step-ahead forecasting equation is employed. Using data sampled more finely than the forecast interval, we are able to reject the simple market efficiency hypothesis for exchange rates from the 1970s and the 1920s. For the modern experience, the tests are also inconsistent with several alternative hypotheses which typically characterize the relationship between spot and forward exchange rates.

2,258 citations

Journal ArticleDOI
01 May 1970

1,935 citations

Journal ArticleDOI
TL;DR: A large literature establishes that beverage alcohol prices and taxes are related inversely to drinking, and public policies that raise prices of alcohol are an effective means to reduce drinking.
Abstract: Aims We conducted a systematic review of studies examining relationships between measures of beverage alcohol tax or price levels and alcohol sales or self-reported drinking. A total of 112 studies of alcohol tax or price effects were found, containing1003 estimates of the tax/price–consumption relationship. Design Studies included analyses of alternative outcome measures, varying subgroups of the population, several statistical models, and using different units of analysis. Multiple estimates were coded from each study, along with numerous study characteristics. Using reported estimates, standard errors, t-ratios, sample sizes and other statistics, we calculated the partial correlation for the relationship between alcohol price or tax and sales or drinking measures for each major model or subgroup reported within each study. Random-effects models were used to combine studies for inverse variance weighted overall estimates of the magnitude and significance of the relationship between alcohol tax/price and drinking. Findings Simple means of reported elasticities are -0.46 for beer, -0.69 for wine and -0.80 for spirits. Meta-analytical results document the highly significant relationships (P < 0.001) between alcohol tax or price measures and indices of sales or consumption of alcohol (aggregate-levelr =- 0.17 for beer, -0.30 for wine, -0.29 for spirits and -0.44 for total alcohol). Price/tax also affects heavy drinking significantly (mean reported elasticity =- 0.28, individual-level r =- 0.01, P < 0.01), but the magnitude of effect is smaller than effects on overall drinking. Conclusions A large literature establishes that beverage alcohol prices and taxes are related inversely to drinking. Effects are large compared to other prevention policies and programs. Public policies that raise prices of alcohol are an effective means to reduce

965 citations