Advanced Search
MyIDEAS: Login to save this paper or follow this series

On the geometry of luxury

Contents:

Author Info

  • A. Mantovi

    ()

Abstract

A 2-parameter class of ordinal utility functions over a pair of goods is discussed with respect to general traits of preferences for luxury. The class contains Cobb-Douglas functions as no-luxury limit; its analytical tractability is probed by simple closed form solutions for Marshallian demand functions, expansion paths, Engel curves, income elasticity of demand, saturation levels, elasticity of substitution. Following Mantovi (2013), scale and substitution effects can be represented in terms of flows on bundle space; departure from homotheticity can thereby be represented by an index of luxury which measures the noncommutativity of such effects. On conceptual grounds, our index is intimately connected with Shephard’s distance. Decompositions of productive efficiency as tailored by Bogetoft et al. (2006) represent a natural setting for the application of our approach.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://swrwebeco.econ.unipr.it/RePEc/pdf/I_2013-02.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Department of Economics, Parma University (Italy) in its series Economics Department Working Papers with number 2013-EP02.

as in new window
Length: 30
Date of creation: 2013
Date of revision:
Handle: RePEc:par:dipeco:2013-ep02

Contact details of provider:
Postal: Via J.F. Kennedy 6, 43100 PARMA (Italy)
Phone: 0521/902454
Fax: 0521/902400
Email:
Web page: http://economia.unipr.it/de
More information through EDIRC

Related research

Keywords: Duality; homotheticity; Cobb-Douglas function; luxury; expansion path; elasticity of substitution; scale effect; substitution effect; income effect; Shephard’s distance;

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Robert Chambers & Thomas Mitchell, 2001. "Homotheticity and Non-Radial Changes," Journal of Productivity Analysis, Springer, Springer, vol. 15(1), pages 31-39, January.
  2. Blackorby, Charles & Russell, R Robert, 1989. "Will the Real Elasticity of Substitution Please Stand Up? (A Comparison of the Allen/Uzawa and Morishima Elasticities)," American Economic Review, American Economic Association, American Economic Association, vol. 79(4), pages 882-88, September.
  3. Andrea Mantovi, 2013. "On the commutativity of expansion and substitution effects," Journal of Economics, Springer, Springer, vol. 110(1), pages 83-105, September.
  4. Bogetoft, Peter & Fare, Rolf, 1999. "Allocative Efficiency of Technically Inefficient Production Units," Unit of Economics Working papers, Royal Veterinary and Agricultural University, Food and Resource Economic Institute 24217, Royal Veterinary and Agricultural University, Food and Resource Economic Institute.
  5. Dixit, Avinash K & Stiglitz, Joseph E, 1975. "Monopolistic Competition and Optimum Product Diversity," The Warwick Economics Research Paper Series (TWERPS), University of Warwick, Department of Economics 64, University of Warwick, Department of Economics.
  6. Hicks, John, 1970. "Elasticity of Substitution Again: Substitutes and Complements," Oxford Economic Papers, Oxford University Press, vol. 22(3), pages 289-96, November.
  7. Paolo Bertoletti & Giorgio Rampa, 2013. "On inferior inputs and marginal returns," Journal of Economics, Springer, Springer, vol. 109(3), pages 303-313, July.
  8. Hurwicz,Leonid & Reiter,Stanley, 2006. "Designing Economic Mechanisms," Cambridge Books, Cambridge University Press, Cambridge University Press, number 9780521836418.
  9. Paolo Bertoletti, 2005. "Elasticities of Substitution and Complementarity: A Synthesis," Journal of Productivity Analysis, Springer, Springer, vol. 24(2), pages 183-196, October.
  10. Cornes,Richard, 1992. "Duality and Modern Economics," Cambridge Books, Cambridge University Press, Cambridge University Press, number 9780521336017.
  11. Chipman, John S & Moore, James C, 1980. "Compensating Variation, Consumer's Surplus, and Welfare," American Economic Review, American Economic Association, American Economic Association, vol. 70(5), pages 933-49, December.
  12. Daniel L. McFadden, 2013. "The New Science of Pleasure," NBER Working Papers 18687, National Bureau of Economic Research, Inc.
  13. Chambers,Robert G., 1988. "Applied Production Analysis," Cambridge Books, Cambridge University Press, Cambridge University Press, number 9780521314275.
Full references (including those not matched with items on IDEAS)

Citations

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:par:dipeco:2013-ep02. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Andrea Lasagni).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.