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Homothetic utility, Roy’s Lemma and consumer’s surplus

Thijs ten Raa ()

Economics Letters, 2017, vol. 161, issue C, 133-134

Abstract: I provide a short proof that consumer’s surplus normalized by income is the correct welfare measure when utility is homothetic.

Keywords: Consumer’s surplus; Compensating variation; Equivalent variation (search for similar items in EconPapers)
JEL-codes: D60 I31 (search for similar items in EconPapers)
Date: 2017
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Handle: RePEc:eee:ecolet:v:161:y:2017:i:c:p:133-134