Attached is a zip file called “Unobsav_matlab.zip”. Once it is unziped, there will be a folder called  Unobsav_matlab containing one Word file and two sub-folders: “Linear Engel” and “Nonlinear Engel”.

The Word file explains how to run the programs contained in the sub-folders.

Sub-folder “Linear Engel” contains 6 m-files that run the exercises related to quasi-homothetic preferences.

Sub-folder “Nonlinear Engel” contains 8 m-files that run the exercises related to goods with non-linear Engel curves.

For completeness I add below the content of the instructions in the word file:


Instructions for running the programs


There are two directories, Linear Engel and Nonlinear Engel. To run the examples just run fmain in the desired directory. The associated m-files are identical, and read:

 
function fmain
 
clear global GAMMA C2BARRA ALPHA THETAH THETAL PiH PiL y
clear global msgt L p11 p21 p12 p22 
clear global yH yL q s_estrela s_til s_chapeu msgt L
 
for C2BARRA = 0: 1: 0
    for p11 = .98: .001: 1.02
        ProbIndvGov(C2BARRA, p11);
        clear global GAMMA C2BARRA ALPHA THETAH THETAL PiH PiL y
        clear global msgt L p11 p21 p12 p22 
        clear global yH yL q s_estrela s_til s_chapeu msgt L
    end
end    
 

This file allows to choose the interval (in the example above [.98,1.02]) and the grid (in the example above, .001) for the price of good 1 in period 1.
It also allow one to vary the value of c_2   thus making good 2 change from necessity to luxury depending on the sign of c_2.

Note that the first line of the loop is void in the case of Non-linear Engel curves. In the case of linear Engel curves it is used to define the value of c_2.

To change other parameters, one should open file probindvgov.m. 

The output of the program is an excell file. Each spreadsheet contains information pertaining to a different value defined in the loop.