A very impressive performance you have here. Thanks for these simplifications. However, I could not comprehend what you expressed when you talked about substitution effect at the beginning of the video. Please I would need it in writing. Thanks.
There's a Russian football coach with the same last name, Leonid Slutsky, who used to coach team Russia in football. Later moved to the UK to work there, British football fans had a field day with his last name... xd Motto was "In Sluts We Trust"... lol
Dear +Prolui , We just uploaded our fourth video to our series on Game Theory. It's about the Battle of the Bismarck Sea, we hope you find it interesting! ruclips.net/video/2DDYtd5FDUk/видео.html If you like it, spread the word! Thanks for watching, The Policonomics Team
Yes, so you can compare how much you actually can consume of x,y with your new bugdet and the amount of x,y you'd have consumed with your old budget. It is as if you had fixed the utility curve and changed the price ratios.
Shouldn't the income effect be the derivative of the marsh demand multiplied by the Hicksian demand function not marsh (as derivative of the expenditure function wrt to prices is the hicksian demand)?
Minute 4:56 are you sure that there will be no effect on consumer welfare in this case? After all, there still is a price increase. I think you mean there is no effect on quantity of x consumed, however, the effect on consumer welfare is negative.
Let's say you have pizza and burgers. A pizza is 3€ and a burger is also 3€. You don't really care about which one you buy, because both are the same price and same tasty. Suddenly, all the restaurant owners say that a pizza is 100€, you simply can't buy a pizza for less then 100€. What are you going to do? Spend 100€ for a damn pizza or just buy burgers for 3€???? I would buy burgers, everybody would do the same, I am not going to buy pizza, so, the demand for pizza is going to decrease, that's why the SE is negative, because you don't want pizza anymore, as it's too expensive, you want cheap and tasty burgers!
For price increase, the SE is negative. Because increase in price will make you want to consume less of it and more of the other good instead. For price decrease it is positive.
![(M4E4) [Microeconomics] Finding Income and Substitution Effects: Slutsky Decomposition Method](/img/1.gif)
i could not understand what my professor was getting at with these diagrams but you explained it so well!!! thank you!!!!
I have a candidacy exam in three weeks, you just saved me about three hours worth of review. God bless.
A very impressive performance you have here. Thanks for these simplifications. However, I could not comprehend what you expressed when you talked about substitution effect at the beginning of the video. Please I would need it in writing. Thanks.
I'm sorry for being immature, but Slutsky is hilarious.
multiLOLable Indeed!
There's a Russian football coach with the same last name, Leonid Slutsky, who used to coach team Russia in football. Later moved to the UK to work there, British football fans had a field day with his last name... xd Motto was "In Sluts We Trust"... lol
This was pretty helpful, thanks.
Dear +Prolui ,
We just uploaded our fourth video to our series on Game Theory. It's about the Battle of the Bismarck Sea, we hope you find it interesting!
ruclips.net/video/2DDYtd5FDUk/видео.html
If you like it, spread the word!
Thanks for watching,
The Policonomics Team
@@Policonomics am””
Can the Hicksian substitute effect be used to discribe a perfect complement preference?
most concise VDO on the topic .....ever !!!! bestttt :D
I don't understand the red line parallel to the new budget line?
Yes, so you can compare how much you actually can consume of x,y with your new bugdet and the amount of x,y you'd have consumed with your old budget.
It is as if you had fixed the utility curve and changed the price ratios.
so when the indefference curve shifts upwards the equilibrium also changes?
In which direction will the substitution effect change the firm’s employment and capital stock if the price of capital increases?
how to draw a graph by ourselves in word or PowerPoint? is there any application to draw a graph like you did?
Shouldn't the income effect be the derivative of the marsh demand multiplied by the Hicksian demand function not marsh (as derivative of the expenditure function wrt to prices is the hicksian demand)?
I would like to see you listening to yourself once upon a time when you also did this for the fist time
Great video, thank you!
Thank you for watching! 😀🅿
How would the table look like for a decrease in price of the good?
what will happen for non-market environmental goods???
what happen in giffen good case when price of x increases
the demand would increase for the giffen good as well
irGuilty thanks
grt job.really u made economics simple thumbs up!
Minute 4:56 are you sure that there will be no effect on consumer welfare in this case? After all, there still is a price increase. I think you mean there is no effect on quantity of x consumed, however, the effect on consumer welfare is negative.
Thank you very much
Why SE is negative for normal goods? I can't understand :(
Exactly,bt it's negative.. little difficult to understand.
*_*
the substitution effect
Let's say you have pizza and burgers. A pizza is 3€ and a burger is also 3€. You don't really care about which one you buy, because both are the same price and same tasty. Suddenly, all the restaurant owners say that a pizza is 100€, you simply can't buy a pizza for less then 100€. What are you going to do? Spend 100€ for a damn pizza or just buy burgers for 3€???? I would buy burgers, everybody would do the same, I am not going to buy pizza, so, the demand for pizza is going to decrease, that's why the SE is negative, because you don't want pizza anymore, as it's too expensive, you want cheap and tasty burgers!
For price increase, the SE is negative. Because increase in price will make you want to consume less of it and more of the other good instead. For price decrease it is positive.
Income effect for inferior good is negative so is substitution effect. And giffen good income effect is negative also.
Superb...
Great， loving you.
amazing thank you
Why do we even talk about the income effect? There is no change in Income right? Could someone please explain
increase in purchasing power, same as income increase
Shouldn't the red parallel restriction line pass through the initial equilibrium?
No
veery nice
gracias,muy bien explicado :)
Gracias a ti ❤ Acabamos de abrir nuestro canal en español! 🅿ruclips.net/channel/UCkhb76DGIpws2gZGC9UeyHw
Sister its not math its eco
stupidly overcomplicated
How much did you pay for a corpse to narrate the video?