We provide a necessary and sufficient condition for goods to be normal when utility functions are differentiable and strongly quasi-concave. Our condition is equivalent to the condition proposed by Alarie et al. (1990), but it is easier to check: it only requires to compute the minors associated with the border column (or row) of the bordered Hessian matrix of the utility function.
Preferences and normal goods: An easy-to-check necessary and sufficient condition / Bilancini, Ennio; L., Boncinelli. - In: ECONOMICS LETTERS. - ISSN 0165-1765. - STAMPA. - 108:1(2010), pp. 13-15. [10.1016/j.econlet.2010.03.005]
Preferences and normal goods: An easy-to-check necessary and sufficient condition
BILANCINI, Ennio;
2010
Abstract
We provide a necessary and sufficient condition for goods to be normal when utility functions are differentiable and strongly quasi-concave. Our condition is equivalent to the condition proposed by Alarie et al. (1990), but it is easier to check: it only requires to compute the minors associated with the border column (or row) of the bordered Hessian matrix of the utility function.
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