Table V.

Out-of-Sample Transfer Error: Median Absolute Value of the Percent Difference in Predicted Elasticities.

Weighing Scheme	Weighted Mean	WLS 1	WLS 2	WLS 3	WLS 4	WLS 5	WLS 6
	Comparison with Synthetic Observations for Excluded Cluster (n=85)
VAC	92.5%	90.5%	87.0%	108.1%	93.9%	119.0%	104.2%
RESCA	76.0%	76.3%	82.7%	89.4%	89.4%	90.7%	78.9%
	Comparison with Excluded Cluster Observations (n=260)
VAC	130.5%	127.5%	89.8%	100.5%	99.9%	120.3%	121.4%
RESCA	82.7%	83.4%	83.1%	89.5%	90.4%	93.7%	87.2%

The out-of-sample transfer error is calculated by iteratively leaving out sets of observations pertaining to each of the K=66 clusters, estimating the model with the remaining clusters’ observations, and then calculating the predicted elasticities and resulting transfer error for the synthetic observation or the actual observations corresponding to the excluded cluster.