Giffen's paradox

Japanese: ギッフェンの逆説 - ギッフェンのぎゃくせつ（英語表記）Giffen’s paradox

This refers to the phenomenon where a price increase increases the demand for that good. It is famous as a counterexample to the law of demand, which states that an increase (decrease) in price decreases (increases) the demand for that good. The effect of a price increase on the demand for a good can be broken down into the substitution effect and the income effect, with the former always decreasing the demand for that good. On the other hand, if the good is an inferior good (normal good) in which demand increases (decreases) in response to a decrease in income, the income effect increases (decreases) demand. Therefore, the Giffen paradox only occurs when the good is an inferior good and the income effect outweighs the substitution effect.

Source: Heibonsha World Encyclopedia, 2nd Edition Information

Japanese:

価格上昇がその財の需要を増加させる現象をいう。〈価格の上昇(下落)は，その財の需要を減少(増加)させる〉という需要法則に対する反例として有名である。価格上昇が財の需要に及ぼす効果は，代替効果と所得効果に分解され，前者は，その財の需要を必ず減少させる。他方，所得の減少に対して需要を増加(減少)させる劣等財(正常財)であれば，所得効果は需要を増加(減少)させる。したがって，財が劣等財で，しかもその所得効果が代替効果を凌駕（りようが）するときにのみ，ギッフェンの逆説が生じる。

出典　株式会社平凡社世界大百科事典第２版について　情報

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