Accession Number:

AD0702620

Title:

DOES AN INCREASE IN THE PRICE OF A NECESSITY REDUCE WELFARE MORE THAN AN EQUIVALENT INCREASE IN THE PRICE OF A LUXURY,

Descriptive Note:

Corporate Author:

RAND CORP SANTA MONICA CALIF

Personal Author(s):

Report Date:

1970-02-01

Pagination or Media Count:

9.0

Abstract:

Consideration is given to the question of whether it is correct to suppose that an increase in the cost of a necessity reduces welfare more than an equivalent price increase in another commodity. It is shown that the answer is no -- the price increase which causes the greater decrease in welfare is independent of which good is a necessity, if necessity is given any usual meaning such as low income elasticity or low price elasticity.

Subject Categories:

  • Economics and Cost Analysis

Distribution Statement:

APPROVED FOR PUBLIC RELEASE