A comparative study of complete systems of demand functions

Ten models of consumer demand, including the indirect translog model, the linear expenditure system and the Rotterdam model, are applied to Swedish data and compared, using fit and predictive performance as criteria. Demand models tend to be superior to naive models, but nonadditive models are not clearly better than additive. Each model is estimated on two levels of commodity aggregation. The results show that the estimated structures depend on the level of aggregation.