The Case of a “Giffen Good”

Spiegel, Uriel

doi:10.1080/00220485.1994.10844823

Cited by 22 publications

(24 citation statements)

References 12 publications

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“…Based on this methodology, many scholars begin to find evidence supporting the existence of Giffen goods, and push research of this field forward to an exploration phase of empirical research. Spiegel (1994) gave two examples in research: one is public transportation. Under the restriction of fixed traffic budget, public transportation may become Giffen goods; the other is nutritious meals for children in every family.…”

Section: Literature Reviewmentioning

confidence: 99%

Giffen Paradox and Industrial Development: A Case Study of Family Service Industry in Beijing

Zheng

Huang

Wang³

et al. 2016

The Chinese Economy

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Section: Literature Reviewmentioning

confidence: 99%

Giffen Paradox and Industrial Development: A Case Study of Family Service Industry in Beijing

Zheng

Huang

Wang³

et al. 2016

The Chinese Economy

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“…4. Utility functions giving rise to Gi¡enity have been proposed by Vandermeulen (1972), Spiegel (1994) and Weber (1997), the last of whom analyses a utility function originally proposed by Wold and Jureen (1953). A feature which all of these proposed utility functions have in common is that they are neither globally quasi-concave nor globally quasi-convex, on the nonnegative orthant.…”

Section: The Demand For Goods Under Mixture Aversionmentioning

confidence: 99%

The Demand For Goods Under Mixture Aversion

Butler

Moffatt

2000

The Manchester School

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We analyse the demand for goods which the consumer has an aversion to consuming in mixtures. Examples are presented. It is suggested that the axiom of non-satiation should be relaxed in order for the model to be internally consistent. The indi¡erence map with mixture aversion and satiation is constructed and is shown to have very unusual properties. It is then demonstrated that constrained maximization of the underlying utility function can result in both goods being consumed. It is also demonstrated that the type of goods analysed here can exhibit the rare characteristic of Gi¡enity. " IntroductionThe simplest model of consumer theory assumes that only two goods are available to the consumer, and that the consumer prefers mixtures of the two goods to extreme quantities of either one of the two goods. It is easily demonstrated that, under the assumption that more is preferred to less, this preference for mixtures gives rise to indi¡erence curves which are convex to the origin. Preference for mixtures is, in fact, embodied in one of the axioms of consumer theory, namely the axiom of convexity.An interesting variation on the simple model is concerned with the situation in which the consumer has an aversion to consuming mixtures of the two goods. The most popular example concerns two di¡erent types of alcoholic beverage: most of us have su¡ered the consequences of mixing grape and grain '. Sproul (1984, p. 25) reports that`I enjoy drinking beer and wine but I prefer not to mix them. I would be just as happy with a bottle of either, or with three-quarters of a bottle of each.' The alcohol example is also tackled by Clements and Selvanathan (1991) and in more humorous spirit by Covicks (1974). In deciding on the level of consumption of beer and wine during a single drinking session, the consumer is in£uenced by the prospect of the undesirable consequences of alcohol consumption, which tend to be worse when a mixture has been consumed than when the same total quantity of a single beverage-type has been

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“…These are just a few of the examples commonly used to motivate Giffen behavior in the presence of a second constraint on the household's choices [Spiegel, 1994].…”

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confidence: 99%