Giffen Goods in a Transition Economy: Subsistence Consumption in Russia
AbstractIn 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.
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Bibliographic InfoArticle provided by SKEMA Business School in its journal Frontiers in Finance and Economics.
Volume (Year): 8 (2011)
Issue (Month): 2 (October)
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Giffen goods; inferior goods; subsistence; Russia; household consumption; post-soviet transition;
Find related papers by JEL classification:
- D1 - Microeconomics - - Household Behavior
- E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
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