Details of the Domain Measurement Framework



Each equilateral triangle represents a price simplex, oriented as shown on the right. The location of a simplex indicates the benchmark cross-price elasticities of substitution. The cross-elasticities between goods 1 and 2 are fixed while the other two cross-price elasticities are varied. The area indicated in the left diagram indicates all combinations of the cross-price elasticities which are consistent with benchmark convexity.