Additive Utility Functions and Linear Engel Curves.
If an individual's utility function is additive and his demand functions exhibit expenditure proportionality, it is well known that his utility function belongs to the "Bergson family". For some problems (e.g., deriving a consumption function from an intertemporal utility function) expenditure propo...
| Publicado en: | Review of Economic Studies Vol. 38; no. 4; pp. 401 - 415 |
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| Formato: | Artículo |
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Oxford University Press / USA
Oct71
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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=4616962&site=ehost-live header: @attributes: shortDbName: hlh uiTerm: 4616962 longDbName: Humanities International Complete uiTag: AN controlInfo: bkinfo: jinfo: jid: 00346527 REM jtl: Review of Economic Studies issn: 00346527 maglogo: N pubinfo: dt: Oct71 vid: 38 iid: 4 pid: 622 pub: Oxford University Press / USA artinfo: ui: 4616962 10.2307/2296686 ppf: 401 ppct: 14 formats: tig: atl: Additive Utility Functions and Linear Engel Curves. aug: au: Pollak, Robert A. affil: University of Pennsylvania su: Consumption (Economics) Utility functions Elasticity (Economics) Income Demand function Lorenz curve Phillips curve Economic demand sug: subj: Consumption (Economics) Utility functions Elasticity (Economics) Income Demand function Lorenz curve Phillips curve Economic demand ab: If an individual's utility function is additive and his demand functions exhibit expenditure proportionality, it is well known that his utility function belongs to the "Bergson family". For some problems (e.g., deriving a consumption function from an intertemporal utility function) expenditure proportionality is a useful simplifying assumption. But for demand analysis the assumption that all income elasticities are unity has little merit even as a first approximation. In this paper I investigate the class of additive utility functions yielding demand functions which are locally linear in income, or, equivalently, yielding income-consumption curves which are linear in some region of the commodity space. The assumption that income-consumption curves for broad aggregates of goods are locally linear is not grossly inconsistent with our knowledge of the world, so this class of utility functions and the corresponding demand functions may be of empirical as well as theoretical interest. In the first section I consider various additive direct utility functions which yield demand functions locally linear in income, and, in the second section, the corresponding indirect utility functions. In the third section I prove that the utility functions considered in Section I are the only additive direct utility functions yielding demand functions locally linear in income. In the fourth section I consider the "counterparts" of the utility functions of Section I (i.e. the additive indirect utility functions obtained by replacing each quantity variable by its dual price variable). In Sections I and IV, I present explicit expressions for the demand functions corresponding to each utility function considered. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: Y dt: @attributes: year: 1971 holdings: @attributes: islocal: N |
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