The delimitation of Giffenity for the Wold-Juréen (1953) utility function using relative prices: A note
Robert Sproule ()
Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), 2020, vol. 14, No 2020-26, 8 pages
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.
Keywords: Slutsky decomposition; Giffen paradox; Wold-Juréen (1953) utility function (search for similar items in EconPapers)
JEL-codes: A22 A23 D11 (search for similar items in EconPapers)
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Working Paper: The delimitation of Giffenity for the Wold-Juréen (1953) utility function using relative prices: A note (2020)
Working Paper: The Delimitation of Giffenity for The Wold-Juréen (1953) Utility Function Using Relative Prices: A Note (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:ifweej:202026
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