Download This PaperConsumer Substitution Effects Under Full Industry Equilibrium
8 Pages Posted: 2 Jul 2004
Abstract
To be of practical use comparative statics must be able to compare long-period equilibria. Such equilibria will almost never have price vectors that are proportional with respect to all prices but one - yet such price vectors are precisely those underlying the usual substitution effect analysis. We consider how this tension may be resolved.
Suggested Citation: Suggested Citation
Steedman, Ian, Consumer Substitution Effects Under Full Industry Equilibrium. Available at SSRN: https://ssrn.com/abstract=513786
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