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IFS Working Papers
June 2004 W04/17
Article
Necessary and sufficient conditions for latent separability
Type: IFS Working Papers
Authors: Ian Crawford
ISSN: 1742-0415
Volume, issue, pages: 5 pp.

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This paper extends the nonparametric methods developed by Samuelson (1948), Houthakker (1950), Afriat (1973), Diewert (1973) and Varian (1982, 1983) to latently separable models. It presents necessary and sufficient empirical conditions under which data on the market behaviour of a price-taking consumer, and a hypothesised allocation across latent groups are nonparametrically consistent with latent separability (Gorman (1968, 1978), Blundell and Robin (2000)). It considers homothetic latent separability and weak separability as special cases.

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