Utility Function Transformations and Money Illusion: Comment.
The article discusses utility functions transformations. Researchers Richard Dusansky and Peter Kalman (D-K) have claimed that the standard condition that utility functions be homogeneous of degree zero (HDO) in money and prices is not a necessary one for demand functions to be free of money illusio...
| Publicado en: | American Economic Review Vol. 70; no. 4; pp. 819 - 823 |
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| Autores principales: | , |
| Formato: | Artículo |
| Publicado: |
American Economic Association
Sep80
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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=4512322&site=ehost-live header: @attributes: shortDbName: hlh uiTerm: 4512322 longDbName: Humanities International Complete uiTag: AN controlInfo: bkinfo: jinfo: jid: 00028282 AER jtl: American Economic Review issn: 00028282 maglogo: N pubinfo: dt: Sep80 vid: 70 iid: 4 pid: 22 pub: American Economic Association artinfo: ui: 4512322 ppf: 819 ppct: 4 formats: tig: atl: Utility Function Transformations and Money Illusion: Comment. aug: au: Howin, Peter Patinkin, Don affil: Associate Professor of Economics, University of Western Ontario. Professor of Economics, Hebrew University of Jerusalem. su: Kalman filtering Utility functions Control theory (Engineering) Money illusion Stochastic processes Estimation theory Supply & demand Economic stabilization sug: subj: Kalman filtering Utility functions Control theory (Engineering) Money illusion Stochastic processes Estimation theory Supply & demand Economic stabilization ab: The article discusses utility functions transformations. Researchers Richard Dusansky and Peter Kalman (D-K) have claimed that the standard condition that utility functions be homogeneous of degree zero (HDO) in money and prices is not a necessary one for demand functions to be free of money illusion. They have proposed a "more general" set of conditions that imply illusion-free demand functions. Researchers Clower and Riley (C-R) have claimed that, on the contrary, the standard condition serves completely to characterize the class of illusion-free demand functions and that the conditions of D-K achieve only a spurious generality. However, D-K have apparently rebutted this claim by pointing out what is actually a minor error in the paper by C-R. Thus, D-K's conditions are more general only in the sense that they allow a consumer whose ordinal utility is HDO to choose an index of cardinal utility that depends upon the vector of money prices. The spuriousness of this generality arises from the well- known fact that (under conditions of certainty) no operational significance can be attached to the choice of a cardinal utility index. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: Y dt: @attributes: year: 1980 holdings: @attributes: islocal: N |
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