The Generalized Fechner-Thurstone Direct Utility Function and Some of its Uses

In this book the foundations and applicability of the Generalized Fechner-Thurstone Utility Function are laid out. It is shown how by removing the constraint of fixed preferences in the neoclassical consumer theory, utility theory can be used to develop non-parametric indices along with elasticities of the marginal rates of substitutions. It is also shown that whereas the existence of a fixed preference utility function is not always guaranteed for different demand functions, there will always exist at least one Generalized Fechner-Thurstone Direct Utility Function. Furthermore, analysis using the Fechner-Thurstone Direct Utility Function is clear and simple and does not rely on ad hoc Taylor expansions. The construction of different true-cost-of-living indices, the comparison of North American consumers, and a habit formation model are developed to show the usefulness of the Generalized Fechner-Thurstone Direct Utility Function.

List of contents

1 Introduction.- 2 The GFT Utility Function.- 3 Estimating the GFT Form.- 4 The GFT and Alternative Forms.- 5 The True Cost-of-Living Concept.- 6 Cross Country Comparisons.- 7 Testing for Habit Persistence.- 8 Concluding Remarks.- A The Five Commodity Groups.- B The Eleven Commodity Groups.

Product details

• Authors: R Basmann, R L Basmann, R. L. Basmann, R.L. Basmann, K Hayes, K et al Hayes, K. Hayes, J. D. Johnson, J.D. Johnson, D. J. Molina, D.J. Molina, D Slottje, D J Slottje, D. J. Slottje, D.J. Slottje
• Publisher: Springer, Berlin
• Languages: English
• Product format: Paperback / Softback
• Released: 29.01.2013
• EAN: 9780387968537
• ISBN: 978-0-387-96853-7
• No. of pages: 159
• Dimensions: 165 mm x 240 mm x 10 mm
• Weight: 295 g
• Illustrations: VIII, 159 p.
• Series: Lecture Notes in Economics and Mathematical Systems; Lecture Notes in Economics and Mathematical Systems
• Subject: Social sciences, law, business > Business > Economics