Double-log functional form
This is a especially useful functional form, since it allows the analyst to
estimate price elasticities and income elasticities.
The coefficient attached to a price explanatory variable (x), in a demand
equation for instance (where y is quantity demanded), using a double-log
function form like the following:
ln(y) = a + b ln(x) + e
gives the elasticity of y (e.g., quantity demanded) with respect to x (.e.g.,
price).
The natural logarithm applied to an exponential equation transform the
equation into a linear equation in logarithms.