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Comparative Statics Of Money-Goods Specifications Of The Utility Function

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  • Paris, Quirino
  • Caputo, Michael R.

Abstract

The introduction of real-cash balances into the neoclassical model of the consumer wrecks havoc, in general, on the empirically observable refutable comparative statics properties of the model. We provide the most general solution of this problem to date by deriving a symmetric and negative semidefinite generalized Slutsky matrix that is empirically observable and which contains all other such comparative statics results as a special case. In addition, we clarify and correct two aspects of Samuelson and Sato’s (1984) treatment of this problem.

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File URL: http://purl.umn.edu/11953
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Bibliographic Info

Paper provided by University of California, Davis, Department of Agricultural and Resource Economics in its series Working Papers with number 11953.

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Date of creation: 2001
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Handle: RePEc:ags:ucdavw:11953

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Phone: 530-752-1517
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Web page: http://www.agecon.ucdavis.edu/
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Keywords: Research Methods/ Statistical Methods;

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Cited by:
  1. Michael Caputo & Quirino Paris, 2005. "An Atemporal Microeconomic Theory and an Empirical Test of Price-Induced Technical Progress," Journal of Productivity Analysis, Springer, vol. 24(3), pages 259-281, November.
  2. Glenn W Harrison, 2008. "Neuroeconomics: A Critical Reconsideration," Levine's Working Paper Archive 122247000000001915, David K. Levine.

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