## Archive for April 29th, 2012

## Modeling Demand Curves?

I have been starting to explore different probability distribution functions (PDFs) and what underlying factors leads to these. For part of the research I’m planning to do for my doctorate, is looking whether online universities in developing nations could effectively compete in the U.S. Marketplace. I’m trying to find appropriate models that can be used to take the disparate factors, and determine things. So far my research and thought on the process has led me to believe that a constraint-based model is appropriate. (In fact I’ll be talking more about constraint-based systems soon, as it seems they may be more prevalent than we may commonly recognize.) But I’d like to find some economic theory and empirical evidence to support the predictions I’m trying to make.

Through a combination of Monte Carlo simulation and finding an equation to support it, I have found that constraint-based systems can lead to a power law distribution. But I’m still trying to find if demand curves are generally a permutation of a power law distribution. I’ve kept looking for information that can lead me to this, but most of the Internet resources about demand curve suggest that a simple way of looking at demand curve is linear. But, they don’t generally give what the more accurate demand curve’s equation or function might be.

So I am looking for advice about where to look to find better models for demand curves.