Contents
What is the non-satiation assumption?
The assumption that a consumer will always benefit from additional consumption. The demand for some goods may have a finite limit, but it is likely that there is some good or service a consumer would benefit from having more of. From: non-satiation in A Dictionary of Economics »
Is local non-satiation weaker than weak monotonicity?
Strong monotonicity is the strongest assumption; monotonicity is weaker one; and local nonsatiation is the weakest one.
What is satiation point?
BIBLIOGRAPHY. The Oxford English Dictionary offers one definition of satiation to be the “point at which satisfaction of a need or familiarity with a stimulus reduces or ends an organism’s responsiveness or motivation” and thereby encompasses, in principle, the satiety of both needs and desires.
What satiated preferences?
Satiated preferences. The bundle (£1,22) is the satiation point or bliss point, and the indifference curves surround this point. In this case the indifference curves have a negative slope when the consumer has “too little” or “too much” of both goods, and a positive slope when he has “too much” of one of the goods.
How do you test for local non-satiation?
It rules out the extreme case where all goods are “bads”, since the point x = 0 would then be a bliss point. Local nonsatiation can only occur either if the consumption set is unbounded or open (in other words, it is not compact) or if x is on a section of a bounded consumption set sufficiently far away from the ends.
What is satiation?
satiate \SAY-shee-ayt\ verb. : to satisfy (a need, a desire, etc.) fully or to excess.
Does local non satiation implies strict monotonicity?
Local nonsatiation is implied by monotonicity of preferences. However, as the converse is not true, local nonsatiation is a weaker condition. There is no requirement that the preferred bundle y contain more of any good – hence, some goods can be “bads” and preferences can be non-monotone.
What is monotonicity in economics?
INTRODUCTION. MONOTONICITY OF PREFERENCES is a common assumption in the theory of the core of an economy. It implies that any increase in consumption will be welcomed by a consumer, independent of the reference consumption bundle.
What does satiation mean?
transitive verb. : to satisfy (a need, a desire, etc.) fully or to excess.
What is satiation in behavior?
Satiation is the condition that exists when a consequence has lost its effect on behavior. Satiation is usually described in relation to reinforcement. However, the condition can also occur with aversive consequences (see the “Complications and Cautions” section).
What is the satiation?
What is a satiation in microeconomics?
The economic principle of satiation is the effect whereby the more of a good one possesses the less one is willing to give up to get more of it. This effect is caused by diminishing marginal utility, the effect whereby the consumer gains less utility per unit of a product the more units of a product he or she consumes.
What is the definition of non-satiation in economics?
non-satiation. The assumption that a consumer will always benefit from additional consumption. The demand for some goods may have a finite Access to the complete content on Oxford Reference requires a subscription or purchase.
What’s the difference between local non-satiation and monotonicity?
Monotonicity of preferences is a strongercondition than local nonsatiation. Monotonicity implies local nonsatiation, but notthe other way around. To see this:
Which is a weaker condition of local nonsatiation?
However, as the converse is not true, local nonsatiation is a weaker condition. There is no requirement that the preferred bundle y contain more of any good – hence, some goods can be “bads” and preferences can be non-monotone. It rules out the extreme case where all goods are ” bads “, since the point x = 0 would then be a bliss point.
When does local nonsatiation occur in a bounded set?
Local nonsatiation can only occur either if the consumption set is unbounded or open (in other words, it is not compact) or if x is on a section of a bounded consumption set sufficiently far away from the ends. Near the ends of a bounded set, there would necessarily be a bliss point where local nonsatiation does not hold.