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Another Look At Price Instability And Consumer Well-Being: Nondurable And Durable (Housing) Markets

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  • BASANT K. KAPUR

    (Department of Economics, National University of Singapore, Singapore 117570, Singapore)

Abstract

We explore the implications of future price uncertainty, although in a different setting from McKinnon (1967). We identify a further, hitherto-overlooked mechanism that can overturn the well-known ‘Waugh paradox’ that risk-averse consumers benefit from price instability, and show that it also has a particularly interesting application to the housing tenure choice issue.

Suggested Citation

  • Basant K. Kapur, 2016. "Another Look At Price Instability And Consumer Well-Being: Nondurable And Durable (Housing) Markets," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 61(02), pages 1-9, June.
    • Handle: RePEc:wsi:serxxx:v:61:y:2016:i:02:n:s0217590816400221
    DOI: 10.1142/S0217590816400221
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