Giffen good

Evidence for the existence of Giffen goods has generally been limited.

The interaction effects are a different kind of anomaly from that posed by Giffen goods.

Giffen goods are difficult to find because a number of conditions must be satisfied for the associated behavior to be observed.

Giffen goods are an exception to this.

Evidence for the existence of Giffen goods is limited, but microeconomic mathematical models explain how such a thing could exist.

There are, however, some exceptions to this rule (see Giffen goods and Veblen goods).

These include Veblen goods and Giffen goods.

Initially discovered by Robert Giffen, economists disagree on the existence of Giffen goods in the market.

Some types of premium goods (such as expensive French wines, or celebrity-endorsed perfumes) are sometimes claimed to be Giffen goods.

One reason for the difficulty in finding Giffen goods that is Giffen originally envisioned a specific situation faced by individuals in a state of poverty.

Only goods which do not conform to the law of demand, such as Veblen and Giffen goods, have a positive PED.

The only classes of goods which have a PED of greater than 0 are Veblen and Giffen goods.

The Great Recession has raised the possibility that very safe financial assets (Treasuries, cash, gold) become Giffen goods in liquidity trap scenarios or during bad economic times.

Giffen goods are named after Scottish economist Sir Robert Giffen, to whom Alfred Marshall attributed this idea in his book Principles of Economics.

All Giffen goods are inferior goods, but not all inferior goods are Giffen goods.

Two different hypothetical types of goods with upward-sloping demand curves are Giffen goods (an inferior but staple good) and Veblen goods (goods made more fashionable by a higher price).

They bought, in other words, a lot of "Giffen goods," the economic term that applies to perverse products that defy the general rules of demand - including luxury items that people buy precisely because they cost more.

This disqualifies them from being considered as Giffen goods, because the Giffen goods analysis assumes that only the consumer's income or the relative price level changes, not the nature of the good itself.

A 2002 preliminary working paper by Robert Jensen and Nolan Miller of Harvard University made the claim that rice and wheat/noodles are Giffen goods in parts of China by tracking prices of goods.

Were we not desperately short of real readies, disposable income, our reduction in demand for new mortgages and cars might easily have resulted in greater demand for beer and ice cream, like some kinds of Giffen goods, not the converse.

The Giffen goods theory is one for which observed demand rises as price rises, but the effect arises without any interaction between price and preference-it results from the interplay of the income effect and the substitution effect of a change in price.

On the other hand, assuming the goods in question are not Giffen goods, a rise in the relative price of leads to a fall in relative demand for , so that the quantity of purchased falls, which reduces expenditure on .

A further 2007 working paper by the same authors (now published in the September 2008 issue of American Economic Review) experimentally demonstrated the existence of Giffen goods among humans at the household level by directly subsidizing purchases of rice and wheat flour for extremely poor families.

Since the existence of Giffen goods outside the realm of economic theory is still contested, the pairing of Giffen goods with ordinary goods has gotten less traction in economics textbooks than the pairing normal good/inferior good used to distinguish responses to income changes.