Satiation, Escaping Satiation, and Structural Change: Some Evidence from the Evolution of Engel Curves

Certain properties of Engel curves have been linked to the occurrence of structural change in the economy (Pasinetti 1981, Metcalfe et al. 2006, Saviotti 2001). From an empirical perspective, however, very little has been done to examine (i) whether indeed satiation is a general property of Engel curves; (ii) whether the rate at which Engel curves converge to satiation may significantly change over time; and (iii) how stable Engel curves are across time such that it may be appropriate to use them to make predictions about structural change. Using data from the UK Family Expenditure Survey, this paper examines these three issues. Length 25 pages