IDEAS home Printed from https://ideas.repec.org/a/prg/jnlpep/v2008y2008i3id331p230-242.html
   My bibliography  Save this article

History and troubles of consumer surplus

Author

Listed:
  • Miroslav Svoboda

Abstract

The paper is focused on history of the concept of consumer surplus presented by Alfred Marshall as an economic tool to measure benefits and losses resulting from changes in market conditions. As it assumes constant marginal utility of money, it was refused by further development of economics. Subsequently, John Hicks redefined the concept using indifference analysis, inducing the use of compensating and equivalent variations in welfare economics. However, we reveal substantial errors in the Kaldor-Hicks-efficiency justification of economic policy and suggest an alternative use for the concept of consumer surplus - in an analysis of economic discrimination.

Suggested Citation

  • Miroslav Svoboda, 2008. "History and troubles of consumer surplus," Prague Economic Papers, University of Economics, Prague, vol. 2008(3), pages 230-242.
  • Handle: RePEc:prg:jnlpep:v:2008:y:2008:i:3:id:331:p:230-242
    as

    Download full text from publisher

    File URL: http://www.vse.cz/polek/download.php?jnl=pep&pdf=331.pdf
    Download Restriction: free of charge

    File URL: http://www.vse.cz/pep/331
    Download Restriction: free of charge

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Irvine, Ian J & Sims, William A, 1998. "Measuring Consumer Surplus with Unknown Hicksian Demands," American Economic Review, American Economic Association, vol. 88(1), pages 314-322, March.
    2. J. R. Hicks, 1942. "Consumers' Surplus and Index-Numbers," Review of Economic Studies, Oxford University Press, vol. 9(2), pages 126-137.
    3. J. R. Hicks, 1941. "The Rehabilitation of Consumers' Surplus," Review of Economic Studies, Oxford University Press, vol. 8(2), pages 108-116.
    4. Haveman, Robert H & Gabay, Mary & Andreoni, James R, 1987. "Exact Consumer's Surplus and Deadweight Loss: A Correction," American Economic Review, American Economic Association, vol. 77(3), pages 494-495, June.
    5. Robert L. Bishop, 1946. "Professor Knight and the Theory of Demand," Journal of Political Economy, University of Chicago Press, vol. 54, pages 141-141.
    6. Hausman, Jerry A, 1981. "Exact Consumer's Surplus and Deadweight Loss," American Economic Review, American Economic Association, vol. 71(4), pages 662-676, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Grimaldi, Raffaele & Beria, Paolo, 2013. "Open issues in the practice of cost benefit analysis of transport projects," MPRA Paper 53766, University Library of Munich, Germany.
    2. Gohar, Abdelaziz A. & Cashman, Adrian, 2016. "A methodology to assess the impact of climate variability and change on water resources, food security and economic welfare," Agricultural Systems, Elsevier, vol. 147(C), pages 51-64.
    3. Peter Cohen & Robert Hahn & Jonathan Hall & Steven Levitt & Robert Metcalfe, 2016. "Using Big Data to Estimate Consumer Surplus: The Case of Uber," NBER Working Papers 22627, National Bureau of Economic Research, Inc.

    More about this item

    Keywords

    consumer surplus; compensating variation; Alfred Marshall; John Hicks;

    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • N30 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - General, International, or Comparative

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:prg:jnlpep:v:2008:y:2008:i:3:id:331:p:230-242. 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: (Frantisek Sokolovsky). General contact details of provider: http://edirc.repec.org/data/uevsecz.html .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.