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Engel's Law Reconsidered

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  • Chakrabarty, Manisha
  • Hildenbrand, Werner

Abstract

Engel's Law expresses a negative stochastic association of the bivariate distribution of income and food share across a population. Among the many different definitions which can be found in the statistical literature four concepts are discussed and tested: Kendall's τ, quadrant dependence, stochastic decreasing conditional food share distribution function and decreasing regression. Only the last one is used in the economic literature, yet it does not imply useful information of the underlying distribution. For linking Engels's Law to micro-economics, stronger concepts of stochastic association are needed. This motivates the empirical study of the proposed alternative concepts of negative association.

Suggested Citation

  • Chakrabarty, Manisha & Hildenbrand, Werner, 2011. "Engel's Law Reconsidered," Journal of Mathematical Economics, Elsevier, vol. 47(3), pages 289-299.
  • Handle: RePEc:eee:mateco:v:47:y:2011:i:3:p:289-299
    DOI: 10.1016/j.jmateco.2011.01.006
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    References listed on IDEAS

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    1. Richard W. Blundell & Martin Browning & Ian A. Crawford, 2003. "Nonparametric Engel Curves and Revealed Preference," Econometrica, Econometric Society, vol. 71(1), pages 205-240, January.
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    5. Joachim Engel & Alois Kneip, 1996. "Recent approaches to estimating Engel curves," Journal of Economics, Springer, vol. 63(2), pages 187-212, June.
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    7. Qi Li & Jeffrey Scott Racine, 2006. "Nonparametric Econometrics: Theory and Practice," Economics Books, Princeton University Press, edition 1, number 8355.
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    9. Karl Schlag, 2008. "A new method for constructing exact tests without making any assumptions," Economics Working Papers 1109, Department of Economics and Business, Universitat Pompeu Fabra.
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    Cited by:

    1. Leonhard K. Lades, 2012. "The impact of differential satiation dynamics on changing consumer behavior, wellbeing, and innovative activity," Papers on Economics and Evolution 2012-16, Philipps University Marburg, Department of Geography.
    2. Leonhard Lades, 2013. "Explaining shapes of Engel curves: the impact of differential satiation dynamics on consumer behavior," Journal of Evolutionary Economics, Springer, vol. 23(5), pages 1023-1045, November.
    3. Andrea Mantovi, 2014. "On Luxury and Equilibrium," Review of Economic Analysis, Rimini Centre for Economic Analysis, vol. 6(2), pages 87-118, December.

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