Substitution effects in intertemporal problems

We consider a broad class of intertemporal economic problems and we characterize the short and long-run response of the demand for a good to a permanent increase in its market price. Depending on the interplay between self-productivity and time discounting, we show that dynamic substitution effects can generate price elasticities of opposite sign in the short and in the long run.

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Year of publication:	2020
Authors:	Dragone, Davide ; Vanin, Paolo
Publisher:	Bologna : Alma Mater Studiorum - Università di Bologna, Dipartimento di Scienze Economiche (DSE)
Subject:	Intertemporal substitution \| Price elasticity \| Tax reforms

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Series:	Quaderni - Working Paper DSE ; 1147
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Working Paper
Language:	English
Other identifiers:	10.6092/unibo/amsacta/6376 [DOI] 169879228X [GVK] hdl:10419/245889 [Handle] RePEc:bol:bodewp:WP1147 [RePEc]
Classification:	D11 - Consumer Economics: Theory ; D91 - Intertemporal Consumer Choice; Life Cycle Models and Saving ; I00 - Health, Education, and Welfare. General
Source:	EconStor

Persistent link: https://ebvufind01.dmz1.zbw.eu/10012658413