Can Weak Substitution be Rehabilitated?

Smith, V. Kerry; Evans, Mary F.; Banzhaf, H. Spencer; Poulos, Christine
February 2010
Environmental & Resource Economics;Feb2010, Vol. 45 Issue 2, p203
Academic Journal
This paper develops a graphical analysis and an analytical model that demonstrate how weak substitution can be used for non-market valuation. Weak complementarity and weak substitution represent preference restrictions that allow us to develop equivalent price changes to describe quantity or quality changes in non-market goods. The price changes are Hicksian equivalents in that they yield the same utility changes as would the quantity or quality changes. After discussion of several potential applications of weak substitution, the paper develops the parallel between the restriction and recent strategies from modeling differentiated goods.


Related Articles

  • Welfare Evaluations in Contingent Valuation Experiments with Discrete Response Data: Comment. Johansson, Per-Olov; Kristrom, Bengt; Maler, Karl Goran // American Journal of Agricultural Economics;Nov89, Vol. 71 Issue 4, p1054 

    Comments on an article by M.G. Hanemann on welfare evaluations in contingent valuation experiments with discrete response data. Mathematical models and equations; Calculation on the probability of consumers' preferences; Extension of the discussion of the choice of money measure in cost-benefit...

  • The Effect of Decision Order on Purchase Quantity Decisions. Nowlis, Stephen M; Dhar, Ravi; Simonson, Itamar // Journal of Marketing Research (JMR);Aug2010, Vol. 47 Issue 4, p725 

    Consumers often resolve trade-offs in a particular order. For example, when making flavor and size decisions, consumers might first decide which flavors to choose and then decide which sizes of those flavors to choose. This research examines the effect of decision order on purchase quantity...

  • Welfare Evaluations in Contingent Valuation Experiments with Discrete Response Data: Reply. Hanemann, W. Michael // American Journal of Agricultural Economics;Nov89, Vol. 71 Issue 4, p1057 

    Offers a reply to the comments made by Johansson, Kristrom and Maler on an article concerning statistical models associated with data from a discrete-response contingent valuation survey of consumers' preferences. Graphical representation of the expected willingness to pay or to sell; ...

  • Measuring substitution bias in price indexes.  // Monthly Labor Review;Jan85, Vol. 108 Issue 1, p60 

    Comments on the article 'An Analysis of Substitution Bias in Measuring Inflation, 1952–82'. Analysis of the substitution bias in Lapeyres-type indexes; Application of methodological approaches on the cost-of-living index formulas; Indication of homothetic aggregate utility function...

  • DEMAND SHIFTS DUE TO SALIENCE EFFECTS: EXPERIMENTAL EVIDENCE. Dertwinkel-Kalt, Markus; K¨hler, Katrin; Lange, Mirjam R. J.; Wenzel, Tobias // Journal of the European Economic Association;Jul2017, Vol. 15 Issue 3, p626 

    We conduct a laboratory experiment that tests two fundamental predictions unique to salience theory. If an agent purchases one of two vertically differentiated products, salience theory makes the following two distinct predictions. First, it hypothesizes that a higher expected price level for...

  • Malaysian Consumers' Preference and Willingness to Pay for Environmentally Certified Wooden Household Furniture. Shukri, M.; Awang Noor, A. G. // Pertanika Journal of Tropical Agricultural Science;Aug2012, Vol. 35 Issue 3, p603 

    Demand for certified timber products (CTPs) is on the rise, with major markets currently in North America and Europe, where consumers are willing to pay price premiums for these wood products. It is reported that there is little or no local demand for CTPs in the developing producer countries as...

  • Local Preferences for Shea Nut and Butter Production in Northern Benin: Preliminary Results. Agúndez, Dolores; Nouhoheflin, Théodore; Coulibaly, Ousmane; Soliño, Mario; Alía, Ricardo // Forests (19994907);Jan2020, Vol. 11 Issue 1, p1 

    Shea products in Benin (West Africa) are produced in a low-developed agroindustry, but they are estimated to be the country’s third largest export. The nut harvesting and quality guaranteeing in the butter process can only be achieved through improvements in the value chain, thus making...

  • Consumer Confidence Index Jumps in Jan. Siegel, Gary E. // Bond Buyer; 

    Reports on an increase in consumer confidence index in New york for December 2001 as reported by the U.S. Conference Board. Significant impact of the increase in consumer confidence index on economy; Expected consumer confidence index.

  • Paradox of choice and consumer nonpurchase behavior. Kinjo, Keita; Ebina, Takeshi // AI & Society;May2015, Vol. 30 Issue 2, p291 

    This paper theoretically analyzes the so-called paradox of choice, introduced by Schwartz (The paradox of choice: why more is less, Harper Perennial, New York, ), which posits that having too many choices can make us unhappy. Although one's possibilities broaden as the number of choices...


Read the Article


Sorry, but this item is not currently available from your library.

Try another library?
Sign out of this library

Other Topics