Not all Giffen Goods, are Inferior Goods
Documentos CEDE from Universidad de los Andes - CEDE
It is well known in the economic literature that the labor supply curve can bend backwards and, therefore, that leisure can be a Giffen good. It is also known that leisure can be a normal good. This article proves that if leisure is a Giffen good, it has to be a normal good. This result also proves that, contrary to common knowledge in economics, not all Giffen goods, are inferior goods. The results presented here could be taken into account, for example, when finding empirical evidence and designing policies on labor supply, in an era of machine learning and artificial intelligence.
Keywords: Leisure; labor supply; Giffen Goods; Ordinary Goods; Normal Goods; Inferior Goods (search for similar items in EconPapers)
JEL-codes: D01 D04 D11 J22 J38 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:col:000089:019138
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