Estimating the Short-Run Income Elasticity of Demand for Electricity by Using Cross-Sectional Categorized Data

Abstract

This study uses the 1980 energy application survey conducted by Ontario Hydro to estimate a short-run or conditional demand for electricity model. Two-step inference procedures are developed to take account of the special nature of the data in which the income variable is recorded in categorical form. Comparisons of short-run income elasticities with other studies, using the complete information of income variable, are also made.