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| Christian Weber |
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| ''Quasi-linear peferences with Auspitz-Lieben-Pareto complementarity'' |
| ( 2004, Vol. 4 No.12 ) |
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| I show that if preferences are quasi-linear (non-linear in goods x1, …, xn but linear in xn+1) and the sub-utility function defined over [x1, …, xn] is strongly concave and exhibits Auspitz-Lieben-Pareto complementarity, then goods x1-xn must be gross and compensated complements for each other and xn+1 must be a compensated substitute for all other goods. Also, an increase in its price of xn+1 must reduce the demand for goods x1-xn. The effects of uncompensated changes in the prices of goods x1-xn on the demand for good xn+1 vary predictably with income. |
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| Keywords: Auspitz-Lieben-Pareto complementarity |
JEL: D1 - Household Behavior: General
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| Manuscript Received : Aug 10 2004 | | Manuscript Accepted : Aug 10 2004 |
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