An Alternative Interpretation of the Houshold's Optimization Problem
This note is an invitation to academic economists to broaden the way in which we presant and interpret the household's optimization problem to out students in Microeconomics course. It suggests that while maximizing utility subject to a budget constraint is mathematically equivalent to minimizing expenditures for a given target level of utility, the psychological implications of these alternatives presentations of the optimization problem may be quite different.
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|Date of creation:||1998|
|Date of revision:|
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