Abstract
It is shown that if a consumer's preference ordering is strictly convex and is representable by means of a concave, twice continuously differentiable utility function, then the partial derivative of a demanded commodity with respect to its price is bounded from above in a neighborhood of a price vector at which the demand fails to be differentiable. In the case of two commodities, if the demand does not possess finite derivatives with respect to prices at a certain point, then the partial 'derivative' of a commodity with respect to its price is equal to minus infinity. The same result holds for n commodities under 'almost every' choice of coordinates in the commodity space. If preferences are weakly convex but the same representation assumption holds, demand may not be single-valued but own-price difference quotients are still bounded from above.
| Original language | English (US) |
|---|---|
| Pages (from-to) | 169-189 |
| Number of pages | 21 |
| Journal | Journal of Mathematical Economics |
| Volume | 16 |
| Issue number | 2 |
| DOIs | |
| State | Published - 1987 |
All Science Journal Classification (ASJC) codes
- Economics and Econometrics
- Applied Mathematics