In this chapter, we derive a general relationship that allows the conversion between the two forms of the restricted models. Examples emphasizing systems of demand equations, polynomial lagged equations, and splines are given in which the transformation from one form to the other are demonstrated as well as the combination of both forms of restrictions. In addition, we demonstrate how an alternative Wald test of the restrictions can be constructed using an augmented version of the reparameterized model.
Hirschberg, J.G., Lye, J.N. and Slottje, D.J. (2009), "Chapter 14 The Use of Restricted Regressions in Estimating Demand Systems", Slottje, D.J. (Ed.) Quantifying Consumer Preferences (Contributions to Economic Analysis, Vol. 288), Emerald Group Publishing Limited, Bingley, pp. 363-381. https://doi.org/10.1108/S0573-8555(2009)0000288017Download as .RIS
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