This paper provides a proof of Alchian and Allen’s thesis—superior good is relatively more consumed in distant market—with some restrictions on the utility function. Comparing to the proof by Borcherding and Silberberg (1978), those assumptions may restrict the model in some sense but we will find the Alchian-Allen theorem is independent of the third law of Hicks (Hicks 1946, pp. 309-311). The theorem is given by natural characteristics of relative demand curves.
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number
1297.
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.:
Laura Razzolini & William F. Shughart & Robert D. Tollison, 2003.
"On the Third Law of Demand,"
Economic Inquiry,
Oxford University Press, vol. 41(2), pages 292-298, April.
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