Giffen Paradox

The lower the price, the lower the demand situation.

• Giffen property - Wikipedia

I don’t think this is the nature of the goods, but the nature of the situation.

• $x+y=M$, under the constraints of [$ ax + by \le C

• I want to maximize [$ x

• The lower the cost of $y$, the smaller the value of $y$ in the solution ($b_1>b_2$ in the figure).

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• The crux of this situation is that we want to maximize x, but there is an equality constraint on M

  • If it’s an inequality constraint, it’s the same point of “buy as many x’s as you can afford”.

• Unexpected Phenomena

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