Luxuries are easier to postpone: A proof

M. Browning; T. F. Crossley

doi:10.1086/317668

Luxuries are easier to postpone: A proof

M. Browning, T. F. Crossley

Research output: Contribution to journal › Article › peer-review

51 Citations (Scopus)

Abstract

We show that (Marshallian) income elasticities are proportional to (Frisch) own price elasticities if all goods are additively separable. This implies that luxuries are likely to be easier to postpone. It also implies that preferences over 'consumption' are unlikely to display a constant elasticity of substitution.

Original language	English
Pages (from-to)	1022-1026
Number of pages	5
Journal	Journal of Political Economy
Volume	108
Issue number	5
DOIs	https://doi.org/10.1086/317668
Publication status	Published - 2000

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abstract = "We show that (Marshallian) income elasticities are proportional to (Frisch) own price elasticities if all goods are additively separable. This implies that luxuries are likely to be easier to postpone. It also implies that preferences over 'consumption' are unlikely to display a constant elasticity of substitution.",

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AB - We show that (Marshallian) income elasticities are proportional to (Frisch) own price elasticities if all goods are additively separable. This implies that luxuries are likely to be easier to postpone. It also implies that preferences over 'consumption' are unlikely to display a constant elasticity of substitution.

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Luxuries are easier to postpone: A proof

Abstract

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