Non-Monotonic C(R) Relations in the Absence of Complementarity

12 Pages Posted: 23 Dec 2002

See all articles by Ian Steedman

Ian Steedman

Manchester Metropolitan University - Department of Economics

Abstract

In both 1976 and 1987 Tatsuo Hatta showed that consumption reversal (dc/dr > 0) can occur in a three-period Wicksellian model of production only if the first and the third labour inputs are Hicksian complements. (This was also generalized to n labour inputs.) Unfortunately, he drew the bold conclusion that consumption reversal is merely one more complication introduced by input complementarity. It is shown here that the specific formal result does not generalize and that the bold claim cannot be sustained.

Suggested Citation

Steedman, Ian, Non-Monotonic C(R) Relations in the Absence of Complementarity. Available at SSRN: https://ssrn.com/abstract=309317

Ian Steedman (Contact Author)

Manchester Metropolitan University - Department of Economics ( email )

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