English | 2022 | ISBN: 9811249784 | 130 pages | True PDF EPUB | 8.63 MB
In this book the author analyzes measures of consumer well-being. The three main, neoclassical measures of well-being are the compensating variation, the equivalent variation, and consumer's surplus. The question is which of the measures of consumer well-being is the best. This book tackles the question, with a surprising outcome that is contrary to the main opinion in the literature. Prof ten Raa presents a test that measures must pass to track utility. The test will be used to sort measures in the remainder of the book. It will culminate in a variant of consumer's surplus, which he calls the consumer's index, and a generalization that applies to nonhomothetic demands. Variants of the consumer's index are presented, including ones that are applicable to demand functions with income effects, even nonlinear ones. So-called broad measures of consumer well-being, such as the Human Development Index, will be encompassed.
Contents:
IntroductionThe Theory of the Consumer in MicroeconomicsHicksian Measures: Equivalent and Compensating VariationsMarshallian Measure: Consumer's SurplusConstant Elasticity of Substitution FunctionsUtility Tracking Measures of Well-beingPrice IndicesThe Consumer's Index: TheoryThe Consumer's Index: Applications and ExtensionsConclusionAppendix: Human Development Index and Its Components
Readership: For researchers and graduate students who are interested to understand more about measures of consumer's well-being.
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