*W. M. Gorman*

*C. Blackorby and A. F. Shorrocks (eds)*

- Published in print:
- 1996
- Published Online:
- November 2003
- ISBN:
- 9780198285212
- eISBN:
- 9780191596322
- Item type:
- chapter

- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0198285213.003.0015
- Subject:
- Economics and Finance, Microeconomics

This is Gorman's first published paper and was published in Econometrica 21 in 1953. A series of formal relationships between community indifference maps and utility possibility maps are stated and ...
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This is Gorman's first published paper and was published in Econometrica 21 in 1953. A series of formal relationships between community indifference maps and utility possibility maps are stated and it is proved that a given system of personal indifference maps yields a unique community indifference map if, and only if, the personal Engel curves are parallel straight lines for different individuals at the same prices (Engel curves are curves showing the relationship between income level and spending on the consumption of some good, at a given price). The most general method of constructing such a set of indifference maps is discovered, and it appears that the utility possibility map can then be written in the form Σu = constant, where u is the utility index. Various applications are discussed.Less

This is Gorman's first published paper and was published in *Econometrica* 21 in 1953. A series of formal relationships between community indifference maps and utility possibility maps are stated and it is proved that a given system of personal indifference maps yields a unique community indifference map if, and only if, the personal Engel curves are parallel straight lines for different individuals at the same prices (Engel curves are curves showing the relationship between income level and spending on the consumption of some good, at a given price). The most general method of constructing such a set of indifference maps is discovered, and it appears that the utility possibility map can then be written in the form Σ*u* = constant, where *u* is the utility index. Various applications are discussed.

*W. M. Gorman*

*C. Blackorby and A. F. Shorrocks (eds)*

- Published in print:
- 1996
- Published Online:
- November 2003
- ISBN:
- 9780198285212
- eISBN:
- 9780191596322
- Item type:
- chapter

- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0198285213.003.0017
- Subject:
- Economics and Finance, Microeconomics

This short note, published in Metroeconomica 13 (1961), begins with the assumption that the preferences of the consumer exhibit linear Engel curves, which were shown in ’Community preference fields’ ...
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This short note, published in Metroeconomica 13 (1961), begins with the assumption that the preferences of the consumer exhibit linear Engel curves, which were shown in ’Community preference fields’ (Ch. 15) to be necessary for the existence of a community indifference map. Engel curves are curves showing the relationship between income level and spending on the consumption of some good, at a given price, and linear Engel curves crop up in several branches of economics. The note explores some of the properties of the preference fields in which linear Engel curves arise, and, in particular, of those in which the marginal propensity to consume each good is an absolute constant. The preference fields are characterized by closed‐form representations in terms of both the indirect utility function and the cost function. An application to international trade theory is discussed.Less

This short note, published in *Metroeconomica 13* (1961), begins with the assumption that the preferences of the consumer exhibit linear Engel curves, which were shown in ’Community preference fields’ (Ch. 15) to be necessary for the existence of a community indifference map. Engel curves are curves showing the relationship between income level and spending on the consumption of some good, at a given price, and linear Engel curves crop up in several branches of economics. The note explores some of the properties of the preference fields in which linear Engel curves arise, and, in particular, of those in which the marginal propensity to consume each good is an absolute constant. The preference fields are characterized by closed‐form representations in terms of both the indirect utility function and the cost function. An application to international trade theory is discussed.