Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/165966
Authors: 
Biørn, Erik
Year of Publication: 
2017
Series/Report no.: 
Memorandum, Department of Economics, University of Oslo 04/2017
Abstract: 
How are substitution in the spatial and in the temporal sense connected? Can estimates based on data with spatial variation be transmitted into values appropriate for exploring temporal variation, and vice versa? This paper, building on, inter alia, Frisch (1959), attempts to give some clarifications and provides elements of a synthesis. The income elasticity of the marginal utility of income, whose inverse is often called the 'Frisch parameter', and its multi-period counterpart, the wealth elasticity of the marginal utility of wealth, are key concepts. Three cases with additive preferences are discussed, and in that context the role of the (generalized) 'Frisch parameter' as an overall measure of substitution across commodities and over time is reconsidered.
Subjects: 
Frisch elasticity
Frisch demand
Intertemporal substitution
Additive preferences
Hometheticity
Marginal utility of income
Marginal utility of wealth
JEL: 
D11
D12
D91
Document Type: 
Working Paper

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