ABSTRACT
The maximum distance a consumer will
travel to purchase goods.
See also: central place theory
identification problem (C1)
The ECONOMETRIC problem of discovering
from data which equation is being esti-
mated. A major example of this is the
problem of separating demand from supply
curves when attempting to construct a
demand curve from raw data. If, over a
period of time, there are shifts in a demand
curve, different observations A, B, C and D
will be on different demand curves X1X1-
X4X4 and so a supply curve (line YY)
rather than a demand curve has been
identified. As this problem arises because
the CETERIS PARIBUS conditions do not hold,
only by collecting data on such back-
ground variables is it possible to identify a
demand curve.
