A Revealed Preference Approach to Identification and Inference in Producer-Consumer Models
Bibliographic record
Abstract
This paper provides a new identification result for a large class of models in which consumers participate in production. I show that consumer preferences are necessary and sufficient to identify production functions through cross-equation restrictions implied by first-order conditions. In addition, I derive a nonparametric revealed preference characterization of the class of models that exhausts its empirical implications. Finally, I use a novel and easy-to-apply inference method that is valid under partial identification. This method can be used to statistically test the model, can deal with any type of latent variables (e.g., measurement error), and can be combined with standard exclusion restrictions. Using data on shopping expenditures and shopping intensity from the NielsenIQ Homescan Dataset, I show that a doubling of shopping intensity decreases prices paid by about 15%. At the same time, I find that search costs are significant, hence largely diminishing benefits of price search.
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How this classification was reachedexpand
Full frame distilled prediction
Teacher imitationNot calibrated prevalence, not ground truth. Human validation pending. Learned from the 10,348 direct Codex labels and 10,348 direct Gemma labels. Candidate is the union of thresholded teacher heads; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels or direct frontier model labels.
Codex and Gemma teacher scores by category
| Category | Codex | Gemma |
|---|---|---|
| Metaresearch | 0.001 | 0.000 |
| Meta-epidemiology (narrow) | 0.000 | 0.000 |
| Meta-epidemiology (broad) | 0.000 | 0.000 |
| Bibliometrics | 0.000 | 0.000 |
| Science and technology studies | 0.000 | 0.000 |
| Scholarly communication | 0.000 | 0.001 |
| Open science | 0.000 | 0.000 |
| Research integrity | 0.000 | 0.000 |
| Insufficient payload (model declined to judge) | 0.000 | 0.000 |
Machine scores (provisional)
The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.
Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.
score_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from itClassification
machine, unvalidatedMachine predicted; a candidate call from one teacher head, not a consensus.
How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".