Consumers’ surplus when individuals lack integrated preferences:A development of some ideas from Dupuit

Sugden, Robert (2015) Consumers’ surplus when individuals lack integrated preferences:A development of some ideas from Dupuit. European Journal of the History of Economic Thought, 22 (6). pp. 1042-1063. ISSN 0967-2567

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    Abstract

    In modern economics, consumers’ surplus is understood as the sum of individuals’ compensating variations, defined by reference to well-behaved preferences. If individuals lack integrated preferences, as behavioural economics suggests they often do, consumers’ surplus cannot be defined. However, Dupuit – the earliest theorist of consumers’ surplus – did not assume integrated preferences. His concept of consumers’ surplus can be interpreted in terms of the maximum yield of discriminatory prices. In principle, this can be measured without making assumptions about preferences, but (contrary to what Dupuit apparently thought) is not in general equal to the area under the observed demand curve.

    Item Type: Article
    Uncontrolled Keywords: consumers' surplus,price discrimination,integrated preferences,dupuit
    Faculty \ School: Faculty of Social Sciences > School of Economics
    Depositing User: Pure Connector
    Date Deposited: 19 Dec 2015 07:11
    Last Modified: 08 Feb 2019 01:07
    URI: https://ueaeprints.uea.ac.uk/id/eprint/55768
    DOI: 10.1080/09672567.2015.1084522

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