Giffen Behavior and Subsistence Consumption.

  title={Giffen Behavior and Subsistence Consumption.},
  author={Robert T. Jensen and Nolan H. Miller},
  journal={The American economic review},
  volume={98 4},
This paper provides the first real-world evidence of Giffen behavior, i.e., upward sloping demand. Subsidizing the prices of dietary staples for extremely poor households in two provinces of China, we find strong evidence of Giffen behavior for rice in Hunan, and weaker evidence for wheat in Gansu. The data provide new insight into the consumption behavior of the poor, who act as though maximizing utility subject to subsistence concerns. We find that their elasticity of demand depends… CONTINUE READING
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