Inverse demand systems and welfare measurement in quantity space.
The writer examines the measurement of welfare changes for the inverse demand system and provides exact welfare measures associated with quantity changes. The distance function is utilized to develop compensating and equivalent variations for quantity changes, which are contrasted to Marshallian su...
| Publicado en: | Southern Economic Journal Vol. 63; pp. 663 - 680 |
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| Autor principal: | |
| Formato: | Artículo |
| Publicado: |
Southern Economic Association
January 1997
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| Acceso en línea: | Ver este registro en EBSCOhost |
| Sumario: | The writer examines the measurement of welfare changes for the inverse demand system and provides exact welfare measures associated with quantity changes. The distance function is utilized to develop compensating and equivalent variations for quantity changes, which are contrasted to Marshallian surplus. Several results that are derived for quantity changes are parallel to those of welfare measures for price changes. It is noted that in view of the increasing use of the inverse demand system and the distance function, welfare measures of quantity changes are of notable importance in policy analysis. In addition, it is pointed out that quantity-based welfare measures can also deal with the welfare effects of price changes when there are well-functioning competitive markets. |
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