On the Estimation of Total Expenditure Elasticities from Derived Engel Functions with Applications to Australian Micro-Data*

This paper proposes a method of estimating total expenditure elasticities based on the implicit Engel equations derived from the Lorenz curve of total expenditure and concentration curves of commodity-specific expenditures. The proposed procedure is computationally easy to implement and produces elasticity estimates which appear to satisfy the adding-up criterion well For illustration, the method is applied to the 1984 Household Expenditure Survey and an attempt is made to compare the present estimates with those generated in previous Australian studies.