Charles Blackorby (Department of Economics, University of British Columbia, Vancouver, British Columbia, V6T 1Z1, CANADA, and GREQAM, êcole des Hautes Etudes en Sciences Sociales, UniversitÊs d'Aix-Marseille II et III, rue de la CharitÊ, F-13002 Marseille, FRANCE) R. Robert Russell (Department of Economics, University of California, Riverside, CA 92521-0427, USA)
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This note extends Gorman's [1959] classic result on two-stage budgeting to encompass the two-group cases that he assumed away. The proof, which exploits unpublished and recently published results not available to Gorman in 1959, makes it apparent that the entire structure needed for two-stage budgeting is, in fact, imbedded in the two-group case.
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Article provided by Springer in its journal Economic Theory.
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