Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/223066
Authors: 
Sproule, Robert A.
Year of Publication: 
2020
Citation: 
[Journal:] Economics: The Open-Access, Open-Assessment E-Journal [ISSN:] 1864-6042 [Year:] 2020 [Volume:] 14 [Issue:] 2020-26 [Pages:] 1-8
Abstract: 
In the study of Giffen behavior or "Giffenity", there remains a paradox. On the one hand, the Wold-Juréen (1953) utility function has been touted as the progenitor of a multi-decade search for those two-good, particular utility functions, which exhibit Giffenity. On the other hand, there is no evidence that the Wold-Juréen (1953) utility function has ever been fully evaluated for Giffenity, with perhaps one minor exception, Weber (The case of a Giffen good: Comment, 1997). But there, Weber showed that the Giffenity of Good 1 depends upon the relative magnitude of income vis-à-vis the price of Good 2. Weber's precondition is so vague that it lacks broad appeal. This paper offers a new and a clear cut precondition for Giffen behavior under the Wold-Juréen (1953) utility function. That is, we show that if the price of Good 1 is greater than or equal to the price of Good 2, then Good 1 is a Giffen good.
Subjects: 
Slutsky decomposition
Giffen paradox
Wold-Juréen (1953) utility function
JEL: 
A22
A23
D11
Persistent Identifier of the first edition: 
Creative Commons License: 
https://creativecommons.org/licenses/by/4.0/
Document Type: 
Article

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