Testing for Structural Change: The Demand for Meat

Abstract

Abstract Recent research on meat demand demonstrates the importance in empirical demand analyses of identifying and measuring structural changes. This paper develops and applies a method of analyzing structural changes in preferences using parameters from empirical demand equations derived from an underlying utility function. Structural changes alter the marginal rate of substitution between goods at fixed points of prices and quantities. The evolution of preference changes is measured by time‐varying multiplicative terms in a translog utility function. The application to meat concludes that structural change occurred in the 1970s and provides measures of the time pattern of demand shifts.