Questions tagged [giffen-goods]

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Is there/can we define a notion of Giffen goods in pure exchange economies?

I was checking some questions I recently answered here on General Equilibrium, and a result from this one (Exchange economy with two agents, what's the competitive equilibrium?) drew my attention: ...
Nicolas Torres's user avatar
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Are grains a Giffen good? Also does circumstances make a good - Giffen good?

I was going through microeconomics course and I came across the Giffen good. Now I have a scenario with me. A family only buys grains and chocolate from the shop and the price of grain is increasing. ...
arjun gopan's user avatar
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Monopolies on Giffen Goods

I’m taking an intermediate microeconomics course in college and just got to the topic of monopolies. I know the concept of a Giffen good. As always, Revenue is given by $R= Pq$. Since the monopoly has ...
Nicolas Torres's user avatar
1 vote
2 answers

$\{\text{Giffen goods} \} \subsetneq \{\text{Inferior goods}\}$

I was asking myself why is a Giffen good an inferior good and I read the following post : Difference between Giffen and inferior goods. Why aren't all inferior goods Giffen goods?. The 2nd comment ...
Kilkik's user avatar
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Does the compensated law of demand hold for giffen good?

Considering 2 goods good 1 and good 2 where good 1 is given. Can you show me with a help of a diagram when the price of good 1 aka the giffen good increases?
reindeer's user avatar
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Offer curves for giffen good [closed]

I learnt that giffen good doesn't satisfy the law of demand, but can we draw an offer curve to represent giffen good?
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Are the goods in additively separable utility functions normal goods?

Inspired by this answer. To make it a bit more precise, by normal good I mean demand is (not necessarily strictly) increasing in income, and by additively separable utility function I mean that a ...
Giskard's user avatar
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Optimal price when elasticity of demand is positive? [closed]

I’m performing some exercises in order to get the optimal price of some product such a potato chips, biscuits, drinks, etc. But I’ve found that some of them have positive elasticities. This can makes ...
Red Noise's user avatar
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Whether a good is a Giffen good should be based on circumstance?

The textbook example of a Giffen good is the potato during the Irish Potato Famine. It is characterised by a positive income effect that is larger than the negative substitution effect when the price ...
Tan Yong Boon's user avatar
5 votes
1 answer

Is the consumer surplus on a Giffen/Veblen good negative?

When drawing the demand and supply curves on a quantity/product space for an upwards sloping demand, assuming the two curves intersect, I noticed that the traditional consumer surplus region lies ...
tox123's user avatar
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Giffen Goods & Complementary Goods

Consider that good X and good Y are complements and good X is a Giffen good. If I increase the price of good X, what affect does this have on the price and quantity demanded of good Y? My reasoning ...
Bell's user avatar
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Difference between Giffen and inferior goods. Why aren't all inferior goods Giffen goods?

What is the difference between an inferior good and a Giffen good? Are the two following definitions for an inferior good equivalent? Def 1: An inferior good is a good for which the demand decreases ...
John's user avatar
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Verification of understanding of the substitution and income effect of normal, inferior and Giffen goods?

My understanding is as follows: Normal Goods: Income and Substitution effects are both positive. Inferior Goods: Income effect negative, substitution effect positive. Substitution effect outweighs ...
tsp216's user avatar
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If the price of a good rises, will the demand always fall?

If the price of a good or service rises, the demand for that product will always fall? Apart from Giffen goods and luxury are there any other cases and what economic analysis supports or argues with ...
John C's user avatar
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Identify whether a good is giffen good or not and under what condition

Given the following partial information about a consumer's purchases.He consumes only two goods. In year 1, $p_1^1=p_2^1=100,x_1^1=x_2^1=100$ In year 2, $p_1^2=100,p_2^2=80,x_1^2=120$ Over what ...
Rowan's user avatar
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1 answer

Do standard definitions of substitute goods and complementary goods assume the Law of Demand?

It seems to me that they do. Suppose $x$ is a Giffen good (that is, it violates the law of demand). Then when $p_x$ increases, the quantity of $x$ demanded increases. Suppose also that this increase ...
Shane's user avatar
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How Would a Firm Which Produces a Giffen Good Maximize Profits?

I am curious as to how a firm which produces a giffen good would maximize profits? Having an upward sloping demand curve seems to imply that we cannot guarantee that there exists a quantity where ...
DornerA's user avatar
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