The Substitution Effect from the Profit Function in Consumption: Expressions from the Marshallian, Hicksian, and Frischian demand functions

Authors

DOI:

https://doi.org/10.17811/ebl.7.3.2018.92-97

Abstract

In the context of the optimizing behaviour assumption of individuals (Becker, 1976), three types of demand functions appear: Marshallian, Hicksian, and Frischian functions (Sproule, 2013). The Substitution Effect (SE) is a relevant concept, with our short paper developing two alternative theoretical expressions, specifically focusing on the Profit Function in Consumption and the Frischian functions. I address the fact that these demand functions with constant marginal utility of income play a very relevant role in the inter-temporal context.

Author Biography

José Ignacio Gimenez-Nadal, University of Zaragoza

Professor

Economic Analysis Department

References

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Brandt, L., Siow, A., and Wang, J. (2013) Substitution effects in parental investments, Jour-nal of Population Economics, 28, 423-462.

Frisch, R. (1932) New Methods of Measuring Marginal Utility, Verlag Von J. C. B. Mohr, Tü-bingen.

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Sproule, R. (2013) A systematic analysis of the link amongst the Marshallian, Hicksian, and Frischian demand functions: A note, Economic Letters, 121, 555-557.

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Published

2018-10-10

How to Cite

Gimenez-Nadal, J. I. (2018). The Substitution Effect from the Profit Function in Consumption: Expressions from the Marshallian, Hicksian, and Frischian demand functions. Economics and Business Letters, 7(3), 92–97. https://doi.org/10.17811/ebl.7.3.2018.92-97

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Articles