The Foundations of Money Illusion in a Neoclassical Micro-Monetary Model: Reply.
The article presents the author's views on the foundations of money illusion in a neoclassical micro-monetary model. The analysis of money illusions, as suggested by two economists Robert Clower and John Riley, rests entirely on the claims that the assumption of degree zero homogeneity (in the varia...
| Publicado en: | American Economic Review Vol. 66; no. 1; pp. 192 - 196 |
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| Autores principales: | , |
| Formato: | Artículo |
| Publicado: |
American Economic Association
Mar1976
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| Acceso en línea: | Ver este registro en EBSCOhost |
| fields | @attributes: recordID: 1 pdfLink: plink: https://search.ebscohost.com/login.aspx?direct=true&db=hlh&AN=4504795&site=ehost-live header: @attributes: shortDbName: hlh uiTerm: 4504795 longDbName: Humanities International Complete uiTag: AN controlInfo: bkinfo: jinfo: jid: 00028282 AER jtl: American Economic Review issn: 00028282 maglogo: N pubinfo: dt: Mar1976 vid: 66 iid: 1 pid: 22 pub: American Economic Association artinfo: ui: 4504795 ppf: 192 ppct: 4 formats: tig: atl: The Foundations of Money Illusion in a Neoclassical Micro-Monetary Model: Reply. aug: au: Dusansky, Richard Kalman, Peter J. affil: State University of New York, Stony Brook. Harvard University. su: Money illusion Economic demand Neoclassical school of economics Utility functions Clower, Robert Elasticity (Economics) Riley, John Supply & demand Budget sug: subj: Money illusion Economic demand Neoclassical school of economics Utility functions Clower, Robert Elasticity (Economics) Riley, John Supply & demand Budget ab: The article presents the author's views on the foundations of money illusion in a neoclassical micro-monetary model. The analysis of money illusions, as suggested by two economists Robert Clower and John Riley, rests entirely on the claims that the assumption of degree zero homogeneity (in the variables) of the utility function "serves completely to characterize the class of illusion-free demand functions" derivable from ordinal utility theory, and that it is possible to reinstate the usual properties by adopting the "semi separable" utility function. This article will eventually prove all these claims wrong. Under the D-K sufficiency conditions it is possible to have demand behavior which is free of money illusion without imposing the restriction that the utility function be homogeneous of any degree. The resulting demand function are indeed free of money illusion. Thus, the first order conditions are examined for the maximization of the equations created in the article, subject to the budget constraint. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: Y dt: @attributes: year: 1976 holdings: @attributes: islocal: N |
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