osewalrus (osewalrus) wrote,
osewalrus
osewalrus

Useful from Freakonomics

This post on why rice may be a Giffen good but prostitution is not. As usual, Levitt uses an eye-catching issue to make a useful economic point, the difference in the willingness to pay a higher quality for a good or service and a true Giffen Good, in which demand increases as a function of a price increase.

Also underlying Levitt's analysis is something I often stress, that not all related goods are close substitutes.
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