Giffen Goods in a Transition Economy: Subsistence Consumption in Russia
City University of New York, CUNY City College of New York - Department of Economics; The University of Pennsylvania - Department of Economics
Janusz M. Szyrmer
CASE - Center for Social and Economic Research
October 1, 2011
Frontiers in Finance and Economics, Vol. 8, No. 2, pp. 27-48, 2011
In the last decade, events outside the realm of Western economics have been viewed as “paradoxes.” We focus on the Giffen paradox, and argue that Giffenity is consistent with a generalized law of demand. We confirm the occurrence of Giffenity in Russia during the early 1990s. During this period, people reduced consumption of less affordable meat and fish despite a decline in their relative prices, while augmenting their consumption of more affordable potatoes and bread, a significant increase in relative prices of the latter goods notwithstanding. We conclude that incorporating Giffenity into current economic theory will make it more robust.
Number of Pages in PDF File: 22
Keywords: Giffen goods, inferior goods, subsistence, Russia, household
JEL Classification: D1, E2
Date posted: February 29, 2012
© 2015 Social Science Electronic Publishing, Inc. All Rights Reserved.
This page was processed by apollo5 in 0.453 seconds