Reply to post: Re: Giffen good?

Does Google make hardware just so nobody buys it?

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Re: Giffen good?

I thought the standard example of the Giffen good was potatoes in the Irish famine. As prices rose, so did demand. This was because prices of all foods were rising, so people abandoned all the increasingly expensive alternatives in order to maximise the bulk they could get with their decreasing spending power.

Most of European agriculture was hit in various ways during those years, otherwise a rise in potato prices caused by the blight should theoretically have lead to people substituting for other goods like bread.

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